UniCredit makes $11 billion all-share bid for Banco BPM, prioritizing Italian consolidation and growth

From Investing.com: 2024-11-25 06:36:53

UniCredit surprises with a 10 billion euro bid for Banco BPM, prioritizing Italian consolidation over any potential move on Commerzbank. CEO Orcel cites the need to stay relevant in the heated Italian banking sector. The all-share proposal offers a 0.5% premium for Banco BPM shareholders, signaling UniCredit’s strategic focus on growth.

Orcel, veteran dealmaker at UniCredit, aims to drive a near five-fold increase in the bank’s share price since 2021. The offer values BPM shares at 6.67 euros each, a premium of about 0.5% to Friday’s closing price. UniCredit’s focus on external growth is evident in its bid for Banco BPM, aligning with Orcel’s strategic vision.

UniCredit’s advances on Commerzbank rocked Europe’s financial establishment, sparking backlash in Germany. The bank’s 21% stake in Commerzbank remains a strategic investment with potential upside. Orcel addresses concerns about managing two bids concurrently, emphasizing a smooth integration process post-acquisition.

Commerzbank shares slide nearly 7% in Frankfurt, while UniCredit shares fall 4% and BPM shares rise 3.2% in Milan. Political opposition and concerns over job cuts hinder UniCredit’s bid for Commerzbank. Discussions around a possible acquisition are put on hold pending Germany’s government formation.

Banco BPM’s recent acquisitions signal a push for Italian consolidation, aligning with UniCredit’s strategic move. The deal with Banco BPM, subject to ECB and antitrust approval, could be finalized by June 2025. UniCredit’s focus on boosting fee income and reducing reliance on lending aligns with Orcel’s strategic vision for the bank.



Read more at Investing.com: Italy’s UniCredit launches surprise $11 billion all-share bid for Banco BPM By Reuters