(News Bulletin 247) – The stock fell after Italian media reports indicating that the Italian subsidiary of Edenred was the subject of an investigation by the Rome prosecutor’s office regarding potential rigging of a call for tenders allocated in 2021. The group confirms the opening of a legal investigation but says it is confident about its outcome.

Violent stock market correction for Edenred this Wednesday. The specialist in prepaid service vouchers (restaurant vouchers, fuel cards) and inter-company payments dropped 13.9% around 3:15 p.m., by far the largest decline in the CAC 40.

“There was press information about the opening of an investigation in Italy concerning potential irregularities in calls for tenders which had led to public contracts,” explains a financial intermediary. “If Edenred’s guilt was proven, then they would pay a fine,” adds this specialist.

Two Italian media, L’Identita and Il Fatto Quotidiano, reported on this investigation. According to the second media outlet cited, the Rome public prosecutor’s office has opened an investigation against Edenred Italia, a local subsidiary of the group, concerning potential fraud and rigging of a 2019 call for tenders, passed by Consip, an entity of the Italian Ministry of Economy and Finance.

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“Parallel discussions” in the viewfinder

This call for tenders was awarded in 2021 to Edenred for a total of 578 million euros, explains Il Fatto Quotidiano. The grievances of the Italian authorities relate, according to the media, to “parallel” and non-public discussions carried out by the management of the subsidiary which allegedly distorted the call for tenders, via promises of discounts. The contract concerned the supply of meal vouchers to employees of public organizations in regions of central Italy.

Edenred reacted early this afternoon in a press release. “An investigation has been opened against Edenred Italia Srl and certain of its directors and officers, in connection with a public call for tenders launched in 2019,” the company confirmed.

“Edenred remains available to the Italian judicial authorities to provide all necessary explanations,” continues the group. “Edenred cannot make any comments while the legal investigation is ongoing, but is confident about its outcome,” he also indicates.

The CAC 40 company will publish its 2023 annual results on February 27, before the market opens.

The group experienced tumult on the stock market last fall, after the executive declared that it was considering establishing a cap on the commissions received by issuers of restaurant vouchers (Edenred, Pluxee, but also Up and Swile). This threat was, however, ruled out following a report from the Competition Authority which judged that such a measure did not “constitute the most appropriate response” and would not “correct the dysfunctions” of the market.