• Investing
  • Stock
  • Editor’s Pick
  • Economy
The Significant Deals
Stock

Italy’s MPS shares fall ahead of Mediobanca board meeting on bid

by January 27, 2025
written by January 27, 2025

By Giulia Segreti and Valentina Za

ROME/MILAN (Reuters) – Shares in Monte dei Paschi (MPS) fell again on Monday, extending Friday’s losses, signalling lingering investor doubts over the bailed out Tuscan bank’s bid for bigger rival Mediobanca (OTC:MDIBY).

On Friday, the state-backed lender launched a surprise 13.3-billion-euro all-share ($13.9 billion) bid for Mediobanca, whose board meets on Tuesday to start reviewing the offer.

Based on Italian takeover rules, the board will be able to express a proper opinion and give advice to shareholders only once the bid’s prospectus is public, in a few months’ time.

In a letter to employees at the weekend, Mediobanca CEO Alberto Nagel said the offer had not been previously agreed and the bank would decide how to best protect the interests of its stakeholders.

Shares in MPS, which has returned to profits and dividends after a bailout in 2017, fell 1.5% by 0832 GMT, extending a 7% drop on Friday.

Mediobanca shares were little changed, after Friday’s 7.7% jump. Italy’s banking index fell 0.5%.

MPS’ proposed takeover, the latest move in wave of consolidation in the Italian banking sector, was welcomed by Italy’s conservative government but it has left analysts concerned about the limited scope for cost savings, and the ability to retain Mediobanca investment bankers.

GOVERNMENT ENDORSEMENT

MPS CEO Luigi Lovaglio, a veteran banker for decades at UniCredit, has said the idea was to combine MPS’ branch franchise with Mediobanca products, while preserving both brands and running Mediobanca’s investment banking business separately.

Mediobanca’s operations include wealth management and consumer finance. On the latter it already partners with MPS.

The government, which still owns 11.7% of MPS, has endorsed the offer and Prime Minister Giorgia Meloni on Sunday said everyone should be proud of MPS’ turnaround.

“If the deal is successful, we will have that third major banking group [after Intesa Sanpaolo (OTC:ISNPY) and UniCredit] which we always spoke about, a group that could help to protect Italians’ savings,” she said.

Meloni’s government had been working on returning MPS to the private sector, after a previous collapsed sale of MPS to UniCredit in 2021.

After spurning MPS then, late last year UniCredit CEO Andrea Orcel derailed government’s efforts to broker a tie-up of MPS and Banco BPM with support from billionaire Francesco Gaetano Caltagirone and the holding company of late fellow tycoon Leonardo Del Vecchio.

Caltagirone and the Del Vecchio family’s Delfin holding are also leading shareholders in Mediobanca.

Barclays (LON:BARC) on Monday predicted further volatility in the shares given the lack of clarity and added MPS had room to distribute more of its excess cash.

The bid enjoys unions’ favour given it does not require significant branch closures and job losses.

“MPS’ hostile bid for Mediobanca could reshape the Italian financial landscape, but is subject to high implementation risk due to different business models and difficulties in achieving sustainable synergies,” Scope Ratings wrote.

($1 = 0.9551 euros)

This post appeared first on investing.com
0 comment
0
FacebookTwitterPinterestEmail

previous post
British Land stock drops following stake sale
next post
Fuji Media, rocked by sexual misconduct allegations, says executives to resign

You may also like

BASF results down on impairments, restructuring

January 27, 2025

European chipmakers slump as traders gauge DeepSeek AI...

January 27, 2025

Nasdaq futures tumble as China’s AI push rattles...

January 27, 2025

China Vanke’s CEO, chairman resign amid growing liquidity...

January 27, 2025

Fuji Media, rocked by sexual misconduct allegations, says...

January 27, 2025

British Land stock drops following stake sale

January 27, 2025

UMG shares rally after new multi-year pact with...

January 27, 2025

BASF shares indicated 3% lower as impairments drag...

January 27, 2025

Ryanair cuts 2026 traffic forecast amid ongoing Boeing...

January 27, 2025

Lawyer group urges overhaul of US bank charter...

January 27, 2025
Fill Out & Get More Relevant News








    Stay ahead of the market and unlock exclusive trading insights & timely news. We value your privacy - your information is secure, and you can unsubscribe anytime. Gain an edge with hand-picked trading opportunities, stay informed with market-moving updates, and learn from expert tips & strategies.

    Recent Posts

    • U.S. foreign tax bill sends jitters across Wall Street

      May 30, 2025
    • Amazon taps Xbox co-founder to lead new team developing ‘breakthrough’ consumer products

      May 30, 2025
    • Nvidia results spark global chip rally

      May 30, 2025
    • Boeing to resume airplane deliveries to China next month, ramp up Max production, CEO says

      May 29, 2025

    Categories

    • Economy (245)
    • Editor's Pick (3,646)
    • Investing (489)
    • Stock (6,426)

    Latest News

    • U.S. foreign tax bill sends jitters across Wall Street
    • Amazon taps Xbox co-founder to lead new team developing ‘breakthrough’ consumer products

    Popular News

    • Nintendo says Switch 2 will be released in 2025
    • Mondelez cut at Jefferies on ‘increasing risk to cocoa production’

    About The Significant deals

    • Privacy Policy
    • Terms & Conditions

    Copyright © 2025 thesignificantdeals.com | All Rights Reserved

    The Significant Deals
    • Investing
    • Stock
    • Editor’s Pick
    • Economy