Leonardo shares: The pact with Avio and the March 3 vote change the game rules
Dear readers,
If you follow the Italian stock market with a keen eye on the defence and aerospace sector, I know you've been keeping a close watch on Leonardo shares. In recent weeks, the stock has shown some volatility, but the real shake-up is brewing on the corporate front, and that's where the game that will set the pace for the coming months is being played. I'm talking about the increasingly tight link between Leonardo and Avio, and the crucial deadline of March 3.
A pact with real weight
Those who know me know I'm not one for pointless technicalities, but here we need to get into the nitty-gritty of the numbers. A few days ago, the agreement linking the giant led by Roberto Cingolani with Avio's top brass officially came to light. We're talking about a shareholders' agreement that brings together Leonardo, some executives, and the chairman of Avio, representing a significant chunk of the voting capital: 21.72% of the voting rights.
This is no minor skirmish. In a company like Avio, the beating heart of European space propulsion, having a bloc like this means being able to steer strategic choices, lock in appointments, and effectively build an even stronger bridge with the parent company based in Piazza Monte Grappa. For those investing in Leonardo shares, this is a clear signal: the vertical integration game is getting serious. It's not just about supplies; it's about industrial governance.
Glass Lewis's take
Into this climate comes the timely opinion of those who have their finger on the pulse of corporate governance. Glass Lewis, one of the world's most influential proxy advisory firms, has put its recommendation in black and white ahead of Avio's March 3 meeting. Their advice to shareholders is clear: vote in favour of the proposal for the new board.
Now, anyone who's followed the markets for a while knows this: Glass Lewis's opinion is much more than just advice. It's a compass for institutional funds, which often mechanically align with these recommendations. Translated: the scenario where Leonardo strengthens its influence over Avio has passed the scrutiny of the corporate governance "wise heads". The hurdles on paper are thinning out.
Why those watching Leonardo shares need to stay alert
Let's try to make sense of this and understand what it all means for the stock's value. The stock market always prices in a narrative, and the narrative taking hold is of an increasingly cohesive Italian aerospace hub under Leonardo's direction.
- Industrial synergies: Coordinated management with Avio can lead to efficiencies, streamlined R&D investment, and greater bargaining power in European programs (from space launchers to missiles).
- Strategic clarity: Stable and aligned shareholding removes the uncertainties that often penalise sector stocks. Fewer rumours, more action.
- Appeal to big funds: Institutional investors love clear-cut situations. A defined control structure makes it easier to include the stock in dedicated defence and aerospace portfolios.
Of course, you always have to factor in the political element. Leonardo isn't just any company, and every move is scrutinised closely by the Prime Minister's office and the Ministry of Business (MIMIT). But from this perspective, an industrial strengthening that comes from the ground up (the pact with managers and the chairman) and receives the nod from governance best-practice assessors is exactly the kind of move that faces the least resistance.
My take
I've seen dozens of similar moves in twenty years on the job. Often they end in a fizzle, with enthusiasm waning at the first hurdle. This time, though, the feeling is different. Leonardo's move on Avio is surgical: not a hostile takeover, but a fine stitching together of agreements and industrial vision. And the March 3 date will be the first real test.
My prediction? Beyond the raw outcome of the meeting – which I see as strongly in favour of the board – what matters is the message that will reach the market: the group led by Cingolani has a free hand and a clear head to build the future. For those holding Leonardo shares, this is an excellent reason to hold onto them tight, and perhaps take advantage of any pullbacks to build up their position.
The game has just begun, but the stakes are already sky-high. Be ready.