Banco BPM SpA bank branch in Milan, Italy on Friday, November 15, 2024.
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Italian financial giant Banco BPM said on Tuesday that a surprise takeover offer by domestic rival UniCredit did not reflect its profitability.
The 10 billion euro ($10.52 billion) bid presented by UniCredit on Monday was not agreed in advance and was offered on “unusual” terms, Banco BPM’s board said in a statement translated by CNBC.
This also does not reflect Banco BPM’s profitability and potential for further value creation, the board added, adding that the expedited timeline of the merger, expected “in the shortest possible time”, is due to the bank’s legal autonomy. He warned that it could harm sexuality.
The Banco BPM bid comes two months after UniCredit, Italy’s second-largest bank, set its sights on a potential takeover of Germany’s Commerzbank. These ambitions have met with fierce opposition from the German government.
Banco BPM’s board of directors said that UniCredit’s proposal exposes stakeholders to uncertainty surrounding its expansion plans in Germany and that it is an “attractive alternative to focusing Banco BPM in the most dynamic regions of the country and the euro.” “This could mean a significant dilution of current geographic exposures.” zone. “
UniCredit CEO Andrea Orcel said on Monday that Banco’s BPM deal would take precedence over any potential business with Commerzbank, according to Reuters.
CNBC has reached out to UniCredit for comment.
UniCredit’s Milan-listed shares were flat as of 12:37pm London time on Tuesday, with Banco BPM shares down 0.20%.
“Historical goal”
On Monday, the bank offered to pay 6.657 euros per share for Banco BPM as part of an all-stock deal, only a small premium to Friday’s closing price of 6.644 euros. In a statement accompanying the bid, Orcel described Banco BPM as a “historic target”, fueling a firestorm of media reports that UniCredit had been suing to merge with a domestic peer in 2022.
“Europe needs stronger, bigger banks to support its economic development and help it compete with other major economies. Thanks to our work over the past three years, UniCredit now has “We are in a good position to meet the challenges.” Orcel said.
His consolidation plan has not yet come to fruition, as UniCredit is awaiting approval from the European Central Bank to raise Commerzbank’s current 21% stake to 29.9%. Also, the response to the domestic plan from the Italian government so far has been lukewarm.
“The safest way to lose a war is to engage on two fronts, and perhaps this time it’s not possible to lose a war on two fronts,” Economy Minister Giancarlo Giorgetti said Monday of UniCredit’s Banco BPM and Commerzbank’s ambitions, according to Italian news agency ANSA. The rules don’t apply.”
Earlier this month, the Italian The stage is set for M&A. This is because the government was aiming to reduce stock holdings. Banks bailed out. At the time, Banco BPM said it did not intend to submit an application that potentially exceeded the threshold for acquiring more than 10% of Monte dei Paschi shares.
