Banca Generali shares rise on report Generali may bid

Banca Generali Shares Jump on Generali Takeover Bid Speculation

Market Reaction and Takeover Bid Developments

MILAN, Oct 8 (Reuters) - Shares in Banca Generali rose on Thursday, making it one of the top performers on the Milan bourse, after Italian media reported that parent Generali could be preparing a takeover bid for the private bank.

Speculation and Investor Sentiment

A person close to the matter said on Thursday there was "no evidence" to support the report. An Italy-based portfolio manager said some investors were giving the scenario "at least some credibility."

Generali's Stake and Financial Implications

• Generali holds a 50.2% stake in Banca Generali, which has been at centre of the Italian banking consolidation drive for several years. Buying the shares it does not already own would cost about €3.5 billion ($3.9 billion) at current market prices, excluding any takeover premium.

Competing Bids and Shareholder Votes

• On October 29, the Italian lender Banca Monte dei Paschi (MPS) shareholders are due to vote on the Tuscan bank's bid for the private bank, a deal seen as key to its efforts to fend off a takeover approach by Intesa Sanpaolo.

Challenges Facing MPS and Intesa Sanpaolo's Role

• However, MPS's path to completing its bid for Banca Generali appears increasingly challenging after three of the bank's largest shareholders backed Intesa Sanpaolo's offer.

• If Intesa's offer succeeds, Italy's biggest bank would also gain control of the roughly 13% stake in Generali that MPS currently holds through Mediobanca.

Strategic Implications for Generali and Intesa

• According to Italian newspaper Il Giornale, Generali's move should be interpreted as anti-Intesa.

• If Generali made an all-share offer for Banca Generali, Intesa's stake would fall below 13% once its bid for MPS was completed.

Share Performance and Trading Activity

• As of 0940 GMT, Banca Generali shares were up 1.75%, making the lender one of the few gainers in the sector as Italy's bank index fell 2.5%. Trading volumes showed no unusual activity.($1 = 0.8938 euros)

(Reporting by Gianluca Semeraro, editing by Keith Weir)