Published by Global Banking & Finance Review®
Posted on April 22, 2025
3 min readLast updated: January 24, 2026
Add as preferred source on GoogleUniCredit's bid for Banco BPM is stalled by government conditions, impacting strategic decisions and market valuations.
By Valentina Za
MILAN (Reuters) -UniCredit said on Tuesday its ability to make "sound" decisions could be impaired by the conditions Italy set to clear the bank's bid for Banco BPM, and it could not proceed further unless its concerns are addressed.
Growing uncertainty over the fate of UniCredit's 13 billion-euro ($15 billion) all-share bid drove Banco BPM's shares down 2% by 1020 GMT. However, the market still values BPM at 1.1 billion euros more than what UniCredit is offering.
UniCredit CEO Andrea Orcel has repeatedly said he is ready to drop the tender offer for BPM, despite the good strategic fit, if the deal does not meet his financial metrics.
A person familiar with the matter, who did not want to be identified, said that given market prices, the government's conditions could prove a dealbreaker.
By contrast, shares in Commerzbank, another potential takeover target for UniCredit after Orcel built a 28% stake, rose 1.7%, bucking a decline in Germany's stock market.
A takeover, however, also faces hurdles as it is opposed by Commerzbank management, unions and the German government.
Orcel has also built a stake in Italian insurer Generali, which some bankers say may give him further options.
Rome on Friday cleared with conditions Orcel's plans to acquire Banco BPM. The bid, which BPM has rejected as hostile, is due to start on April 28.
It will last until the end of June and UniCredit has reserved the right to decide at the very end whether to see it through.
In setting its conditions, the government has given UniCredit nine months to cease its activities in Russia, a person with knowledge of the matter previously told Reuters.
Russian laws make it impossible for a company to exit without a presidential and central bank green light.
Rome has also asked the lender not to reduce for five years the banks' loan-to-deposit ratio, which is currently higher for Banco BPM, compared to UniCredit, the person said.
UniCredit must also avoid reducing investments in Italian securities at Anima Holding, a fund manager recently acquired by Banco BPM, and support Anima's growth.
UniCredit's swoop on BPM, which derailed Rome's plans to combine BPM with state-backed Monte dei Paschi di Siena, is among other hostile takeover bids rocking Italian banking.
Rome has cleared unconditionally Monte dei Paschi's offer for Mediobanca, and BPER's bid for Popolare di Sondrio.
"The prescriptions imposed to UniCredit, could harm its full freedom and ability to take sound and prudent decisions in the future, and even lead to unintended results" such as fines, UniCredit said in a statement on Tuesday.
The government's decree, which UniCredit received on Friday, included the possibility for the bank "to immediately report to the (relevant) authority if it is not possible to implement - in whole or in part - the prescriptions," Italy's second biggest bank said.
"UniCredit has promptly responded to the authorities with its views on the decree and awaits feedback. Until then, UniCredit is not in a position to take any conclusive decision on the way forward regarding its offer on Banco BPM," it added.
($1 = 0.8698 euros)
(Reporting by Valentina Za, editing by Susan Fenton)
The article discusses UniCredit's bid for Banco BPM and the challenges posed by Italian government conditions.
Conditions include ceasing Russian activities and maintaining certain financial ratios.
Andrea Orcel is the CEO of UniCredit, leading the bid for Banco BPM.
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