How An Italian Entrepreneur Built A $1.6 Billion Fortune Investing In Energy Companies
Little-known in his home country of Italy, Romano Minozzi, 85, has quietly amassed an estimated $1.6 billion fortune through shrewd investments in the Italian energy sector. Though he found his first pot of gold in ceramics, the bulk of his current wealth lies in his shareholdings of Snam and Italgas, two natural gas companies that trade on the Milan stock exchange. Together, they make up more than 80% of his net worth, and make Minozzi one of the latest entrants to the Fintech Zoom 2020 World’s Billionaires list.
Minozzi chalked up his passion for investing to his first job out of college at a small bank in the city of Modena, according to a May 2019 interview with Italian daily Corriere della Sera. Armed with an economics degree from the nearby University of Bologna, Minozzi reportedly dipped his toes into the stock market, buying and selling small amounts of shares in his off-hours. That experience pushed him to take a much bigger risk in 1961, when he cobbled together enough money — including a roughly $500,000 (300 million lira) loan from investment bank Mediobanca — to buy a small ceramics company that was about to go bust. He renamed it Iris, after the Greek goddess of the rainbow.
The business flourished as the Italian economy continued its post-war boom through the 1970s and 80s, reaping the benefits of its location at the heart of Italy’s ceramics industry. The firm, which now hauls in more than $550 million in annual revenue from bathroom tiles and wall slabs, also has subsidiaries in the United States, Mexico, Spain and Portugal.
“I’m a ceramics industrialist, I bake earth,” Minozzi told Corriere della Sera. “In finance you have to be detached, but ceramics is a heavy industry. You have to put your heart into it.”
His ceramics success enabled Minozzi to focus his attention on the stock market at the turn of the millennium, including investments in Mediobanca, the bank that had loaned him the much-needed starter funds, and a three-year stint on the board of Ferrari, whose storied headquarters are located down the road from his Iris in the town of Maranello.
Minozzi emerged as a major player in Italy’s energy sector in 2010, when he purchased a reported 4.2% stake in Rome-based electricity transmission grid operator Terna for $173 million. Three years later, he sold his shares for approximately $465 million, then bought a 3% stake in Snam in 2016 for about $660 million. He obtained shares in Italgas when it was spun off from Snam later that year. He is now the largest individual shareholder of both companies, controlling about 7.2% of Snam shares and 3.7% of Italgas stock. The two firms have a market capitalization of $13.7 billion and $4.2 billion, respectively.
Snam and Italgas shares have both fallen by roughly 15% since the beginning of March — a better performance than the 21% decline recorded by the Italian benchmark stock index, the FTSE MIB. Despite the catastrophic economic impact of the country’s coronavirus lockdown, utility networks like Snam and Italgas face limited risk from the crisis, according to Fitch Ratings analysts. On March 12, Snam announced a $22 million donation to the Italian healthcare system and nonprofits to aid their efforts in combating COVID-19.
“Minozzi is a long-term investor, attentive to corporate governance and sustainability,” a Snam representative told Fintech Zoom. “He’s believed in the company since he received shares in Italgas, we see him as a long-term and stable investor,” says an Italgas spokesperson. Minozzi and Iris Ceramica declined multiple requests for comment for this story.
Minozzi handed the reins of his ceramics empire to his daughter Federica in December 2017, when she took over as CEO of Iris. While he’s no longer involved in the day-to-day operations of the company, he still lives in the hamlet of Spilamberto, a short drive away from Iris’ headquarters. His investment portfolio also includes a range of smaller holdings, such as stakes in Gazprom, Generali, Banco Santander and AT&T, according to Iris Ceramica’s 2018 annual report.