Intesa says it could beat improved profit outlook, won't raise MPS bid
Intesa Sanpaolo's Profit Outlook and MPS Bid: Key Developments
By Valentina Za
MILAN, July 29 (Reuters) - Intesa Sanpaolo, Italy's biggest bank, raised its 2026 profit outlook on Wednesday and said it could comfortably beat the new target, but ruled out sweetening its bid for rival Monte dei Paschi di Siena (MPS).
Background: Italian Banking Consolidation and Intesa's Move
After staying out of a first wave of Italian banking consolidation that started in 2023 and culminated in MPS's €13.5 billion ($15 billion) acquisition of Mediobanca in September 2025, Intesa announced a €34.5 billion cash-and-shares bid for MPS in June, sparking a new round of dealmaking.
MPS has said the offer undervalues the bank, but has not rejected it formally and said it would consider all options.
Intesa's Stance on the Bid
"There is zero possibility that we will increase our price for Monte dei Paschi," Intesa CEO Carlo Messina said, adding MPS traded at about 15 times earnings, compared with about 11 times for Intesa and UniCredit.
Alternative Options and Market Reactions
Competing Bids and Strategic Considerations
ALTERNATIVE OPTIONS
Challenging Intesa, mid-sized lender Banco BPM has asked MPS to discuss a "merger of equals".
However, a person close to the matter said MPS Chief Executive Luigi Lovaglio would consider an alternative only if it offered greater value, with the €3 billion cash component of Intesa's bid setting the benchmark.
MPS's Position and Generali Stake
By acquiring Mediobanca, MPS has become the main investor in insurer Generali, with a 13% stake currently worth around €9 billion. Lovaglio has previously described the holding as non-core.
Answering analysts, Messina acknowledged that Intesa would need to reassess its bid if MPS sold the Generali stake, but said such a move would require shareholder approval, regulatory clearance and a buyer acceptable to the government.
A second person familiar with MPS's defence strategy told Reuters the bank was not considering a sale of the stake.
Outlook, Financial Results, and Next Steps
Shareholder Backing and Bid Timeline
Intesa is seeking shareholder backing for its offer on September 10 and is expected to launch the bid in the fourth quarter.
Upgraded Profit Targets and Performance
Intesa forecast 2026 net profit of more than €10 billion —the figure it had been targeting until now.
"We can easily ... exceed in a significant way our outlook," Messina said.
He said the upgraded target left room for potential "managerial actions", typically a reference to spending on voluntary early-retirement schemes.
"We decided not to push on this outlook, also because being under an M&A deal," he added.
Recent Financial Results
Net income for the three months to June 30 was €2.8 billion, beating an LSEG-compiled consensus forecast of €2.5 billion.
Revenue totalled €7.4 billion, about 6% above forecasts helped by strong trading income. Net fee income rose 7% year on year, while net lending income increased 1%.
($1 = 0.8783 euros)
(Reporting by Valentina Za. Editing by David Goodman and Mark Potter)
