The agreement, which comes about three months after Atlantia confirmed its interest in taking over its rival, entails Atlantia swapping one share for every nine ordinary shares in Gemina. The combined company will have full control over Italy's toll motorway operator Autostrade der l'Italia SpA as well as 96% of Aeroporti di Roma SpA, which operates Italy's largest airport in the capital.

The combined company will be controlled by Italy's Benetton family through its infrastructure holding company, Sintonia SpA, which will own a 45.6% stake. It will have a market value of about €10.2 billion ($13.3 billion) based on current share prices.

On Monday in Milan, Atlantia shares fell 2.1% to trade at €12.47, while Gemina shares shed 4.7% to trade at €1.31.

The deal will allow Atlantia, known as Autostrade SpA until 2007, which currently operates 5,000 kilometers of toll motorways in Italy, Brazil, Chile, India and Poland, to branch out into airport concessions, just as Rome's airport benefits from growth in inbound traffic from emerging markets.

The companies also said that Atlantia's "proven experience" will strengthen Aeroporti di Roma's ability to access the capital markets, enabling the latter to diversify its funding sources and expand its investor base.

The tie-up comes amid similar moves elsewhere in the industry, including France's Vinci SA's €3 billion purchase of Portugal's state-owned airport concessions business ANA Aeroportos de Portugal SA, agreed in December.

For advice on the deal Atlantia's board of directors turned to Goldman Sachs International, Banca IMI SpA, Mediobanca Spa and Royal Bank of Scotland Group plc, with Roland Berger Stratgy Consultants Sarl acting as business adviser and Deutsche Bank AG providing a fairness opinion on the exchange ratio.

Gemina's board of directors turned to financial advisers Barclays plc and UniCredit SpA; as well business adviser Bain & Co.; and France's BNP Paribas SA, which provided a fairness opinion on the exchange ratio.

Atlantia independent directors enlisted Intermonte and Rotshshild, and legal advisers Carbonetti e Associati and Gianna, Origoni, Grippo, Cappelli & Partners.

Gemina independent directors were advised by Banca Leonardo and Credit Suisse Group on the financial side, and by law firm Chiomenti.

Atlantia took legal advice from the Bonelli Erede Pappalardo law firm, while Gemina turned to the Chiomenti law firm.

The deal, which will be voted on by shareholders on April 30 and on May 15, is expected to be completed by year's end.