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Milan mayor sides with Mediobanca, saying MPS bid is Rome-Milan match
Published by Global Banking and Finance Review
Posted on January 29, 2025
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Published by Global Banking and Finance Review
Posted on January 29, 2025
By Valentina Za
MILAN (Reuters) - Milan mayor Giuseppe Sala on Wednesday sided with Mediobanca in a takeover battle launched by state-backed Monte dei Paschi di Siena (MPS), signalling the financial saga was becoming increasingly political.
Sala, a former corporate executive, leads a left-wing administration in Italy's financial capital.
MPS's 13.3 billion euro ($13.8 billion) all-share bid for the Milanese rival has shocked Italian finance by pitting a lender that used to epitomise the country's banking woes against one of the most revered names in the industry.
"It's clear that (the deal) doesn't possess a strategic sense as much as the presence of the government, which is cause for, I don't want to say shock, but concern," Sala told SkyTg24 television.
"Not long ago we rescued MPS with Italians' money and now we're supporting it in a takeover the rationale of which is hard to see. This can be seen as Rome versus Milan, and this is how it is perceived in Milan."
The bid comes after Italy's conservative government in November brought onboard as MPS shareholders Delfin, the holding company of late Luxottica founder Leonardo Del Vecchio, and Roman construction magnate Francesco Gaetano Caltagirone, who is seen as close to Prime Minister Giorgia Meloni.
Delfin and Caltagirone together own 27% of Mediobanca, 15% of MPS and 17% of insurer Generali.
The state still owns 11.7% of the Tuscany-based bank, down from 68%.
Delfin and Caltagirone are foes of Mediobanca CEO Alberto Nagel, whom they accuse of relying excessively on income from Mediobanca's 13% stake in Generali. In 2023, Generali accounted for 41.6% of Mediobanca's net profit.
"Even a child understands that this is not just about Mediobanca, but Mediobanca and Generali," Sala said.
Meloni's government has given its backing to the bid, with Economy Minister Giancarlo Giorgetti saying the proposed deal might strengthen the country's banking system and its broader economy.
Although Giorgetti is a political opponent of Sala, he is also a member of the League party, which has traditionally had deep roots across Italy's north. His support for the MPS move to a degree undercuts accusations of a north vs south clash. ($1 = 0.9618 euros)
(Reporting by Valentina Za; Editing by Crispian Balmer)