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Italy’s UniCredit has launched a €10.1bn takeover bid for its rival Banco BPM, in a deal that might step up consolidation of Europe’s fragmented banking sector.
UniCredit mentioned on Monday that its all-stock supply valued every Banco BPM share at €6.66 and the deal, if agreed, would create Europe’s third-largest lender by market capitalisation.
It comes months after UniCredit, led by dealmaker Andrea Orcel, shook European finance by revealing it had amassed a stake in Commerzbank, Germany’s second-biggest lender.
Orcel mentioned in a press release {that a} deal for BPM would “broaden our geographic attain, develop our shopper base throughout each retail and company shoppers, and additional develop our premium companies”, including that it might cement UniCredit’s standing as Italy’s second-biggest financial institution.
He mentioned the supply for BPM “doesn’t have any implications” for its funding in Commerzbank. The German financial institution’s administration has thus far dismissed UniCredit’s method.
“The state of affairs there may be very completely different,” Orcel mentioned. He mentioned, in relation to its Commerzbank stake, that UniCredit “could both search to go additional if the circumstances are proper or to exit our funding and return the capital”.
That call would take time as a result of “I believe it is very important respect the electoral course of in Germany”, he mentioned. Germany is about to carry a snap basic election in February.
Discuss of consolidation amongst Europe’s banks has begun to select up in current months, with policymakers within the area eager to encourage the emergence of bigger home teams and multinational banks that may problem US giants and fast-growing rivals in Asia.
UniCredit’s supply represents a 0.5 per cent premium to Friday’s worth however a premium of 14.6 per cent premium to the share worth on November 6, the date on which Banco BPM made a suggestion to purchase asset supervisor Anima Holding for €1.6bn.
Days later BPM additionally took a 5 per cent stake in Monte dei Paschi di Siena when Italy’s authorities offloaded a part of its shareholding within the once-ailing lender, kick-starting a home consolidation course of.
UniCredit mentioned that BPM “doesn’t at present have the enough scale to function in a context of main change and evolution”.
BPM declined to remark.
Orcel made his identify advising on financial institution M&A, together with the €21bn merger of Italy’s Credito Italiano with UniCredito to create UniCredit. He additionally suggested on Royal Financial institution of Scotland’s disastrous acquisition of ABN Amro in 2007.
UniCredit constructed its Commerzbank place by shopping for a piece of shares from the German authorities and including to that utilizing derivatives.
