A new chapter has begun in Italy's most compelling corporate soap drama. In order to increase its share in Assicurazioni Generali over its current holding of around 10%, Delfin, the holding company of the late eyeglasses tycoon Leonardo Del Vecchio's family, received regulatory authorisation. Theoretically, that opens the door for Delfin, which currently holds 20% of the Italian investment bank Mediobanca, to acquire up to 20% of the leading insurer in Italy, which has revenues of 30 billion euros. The possibility delighted investors, who drove up stock prices 5% on Monday. But the euphoria might be unwarranted.

The controversy first surfaced in 2019, when Del Vecchio started to amass shares in Mediobanca, the company that owns 13% of Generali and is the largest shareholder. At the same time, he also voiced his criticism of the techniques employed by both the bank and the insurance company. A larger anti-Mediobanca coalition's unsuccessful attempt to oust Philippe Donnet, CEO of Generali, was also a part of that story last year, but it seemed to die down after Del Vecchio's passing away in June 2022.

Despite the market recovery, there is currently no indication that the Del Vecchio family wishes to expand their Generali presence. A share repurchase was the technological development that led to the regulator's approval. More crucially, increasing by 10% would need an investment of 3 billion euros, which is over three times the yearly income Delfin anticipates from the investments it makes this year. The family might nevertheless decide to increase their wager at a certain point in the future, although it might take some time before the next Generali plot twist occurs.