Key facts
- Intesa Sanpaolo has made a €30.6 billion ($35 billion) unsolicited bid for Monte dei Paschi di Siena (MPS).
- The proposed merger would create the euro zone's second-largest lender by market value.
- Italy's economy ministry confirmed it was informed of Intesa's bid and a separate approach from Banco BPM.
- Intesa's offer includes a 12.5% premium to MPS' closing share price on Friday.
- To address antitrust concerns, Intesa has agreed to sell 635 MPS branches and central offices to insurer Unipol.
Intesa Sanpaolo, Italy's largest banking group, has launched an unsolicited €30.6 billion ($35 billion) cash-and-share bid to acquire rival Monte dei Paschi di Siena (MPS). The move aims to create the second-largest lender in the euro zone by market value, positioning Intesa behind only Spain's Santander. This transaction would be the largest banking merger in Italy in two decades, significantly reshaping the country's financial landscape.
Italy's economy ministry acknowledged being informed of Intesa's bid and a prior approach from Banco BPM, emphasizing the value of MPS, which received a state bailout in 2017. MPS, the nation's oldest bank, is scheduled to discuss the offers at a board meeting. Intesa CEO Carlo Messina expressed confidence in securing investor support, noting his positive relationships with MPS' principal investors, Delfin and Francesco Gaetano Caltagirone, and highlighted the cash component of the offer designed to win them over. Intesa's bid represents a 12.5% premium over MPS' closing share price on Friday.
Banco BPM, which had been considered a leading candidate for a merger with MPS, had submitted its own proposal on Sunday. Messina characterized BPM's approach as a "love letter" compared to Intesa's concrete offer, asserting that Intesa's bid preceded BPM's. Under Italian takeover rules, Intesa's formal offer now prevents MPS from finalizing a deal with BPM without shareholder approval.
To satisfy antitrust requirements, Intesa has entered into an agreement with insurer Unipol, an Intesa ally and main investor in BPER Banca, to sell approximately half of MPS' branches (635) and its Siena headquarters if the bid is successful. Unipol plans to pay up to €3.5 billion for these assets and merge them with BPER Banca, creating a new entity named Banca Monte dei Paschi. Intesa aims for the combined entity to have a market capitalization of €126 billion and a net income goal of €16 billion by 2029.
Intesa also intends to retain MPS' 13% stake in Generali, a significant insurer, which MPS acquired via Mediobanca. Intesa had previously attempted to acquire Generali in 2017. To preempt any defensive maneuvers from Generali, Intesa has acquired a 3% stake in the insurer. The bank also plans to retain Mediobanca, bolstering its wealth management and corporate investment banking operations.