Monte dei Paschi Considers Defence Strategies Against Intesa Takeover Bid
Overview of Monte dei Paschi's Response to Intesa's Takeover Attempt
ROME, Aug 19 (Reuters) - The board of Monte dei Paschi di Siena (MPS) will discuss potential takeover defence options on Thursday as the Italian bank seeks to repel the advances of Intesa Sanpaolo, a source close to the matter said on Wednesday.
Potential Share-Swap Offers Under Consideration
MPS Chief Executive Luigi Lovaglio is working on two potential share-swap offers for rival Banco BPM and Generali-controlled wealth manager Banca Generali to fend off Intesa's bid, daily Il Sole 24 Ore reported earlier on Wednesday.
MPS, Banca Generali and Banco BPM declined to comment.
CEO Aims to Avoid MPS Break-Up
Background and Recent Developments
Bailed out by the Italian state in 2017 and reprivatised in 2023-2024, MPS became the target in June of an unsolicited €36 billion ($42 billion) takeover bid by Intesa.
Under Italian takeover rules, any MPS countermeasures require clearance by its shareholders.
CEO's Defence Strategy
Lovaglio has previously said he was studying defence options, noting that breaking up MPS' commercial network — as Intesa plans to do by selling half of its branches — would destroy value.
MPS Counting on 'Strategic Flexibility'
Financial Strength and Government Support
Presenting quarterly results this month, MPS said it had "strategic flexibility" in its defence, thanks to a core capital ratio of 16.3% at the end of June, almost seven percentage points above regulatory requirements.
Lovaglio praised recent comments by Italian Prime Minister Giorgia Meloni, who had expressed hope that MPS would not be broken up. A meeting between Italian Finance Minister Giancarlo Giorgetti and Tuscany and Siena local authorities is scheduled for Thursday in Rome to discuss the bank's future.
Banco BPM's Withdrawal from Merger Talks
Timeline and Shareholder Influence
Banco BPM, Italy's fourth-largest bank, last month abandoned a plan to seek a merger with MPS after making no definitive progress since it first proposed discussions on a tie-up in early June as a challenge to Intesa's takeover bid.
That decision came after BPM's main shareholder, France's Credit Agricole, said it saw no value in such a deal.
Additional Information
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(Reporting by Valentina Za, Andrea Mandalà and Francesca PiscioneriWriting by Giulio PiovaccariEditing by Emelia Sithole-Matarise and David Goodman)
