Mediobanca Boccia the OPS of Monte Paschi: “Hysterish move. Destroy value”

The Board of Directors of Mediobanca rejects the 13.3 billion offer launched by Monte Paschi di Sienajudging it “without industrial and financial rational”.

Because “no” to OPS

The Board of Directors of Mediobanca made it known that the offer of Banca Monte dei Paschi di Siena (MPS) “it was not agreed and it is to be considered hostile and contrary to interest of Mediobanca “. Without prejudice that Mediobanca will express themselves on the offer with the timing, the tools and according to the methods provided for by the law, on the basis of the analysis of the press release considers the offer “without industrial and financial rational, and therefore destructive of value For Mediobanca “.

Deal without industrial rational

The operation also for the Banca di Piazzetta Cuccia “lacks industrial rational as it involves: a strong weakening of the Mediobanca business model focused on the segments of specialized and profitable activities such as the Wealth Management and Investment Banking; similarly, Losses of revenues and customers would affect the Wealth Management and investment banking, based on the group development plan, also for uncertainty which would be worse on the ability of the possible combined entity to retain the main customers; the loss of customers will be reasonably accompanied by the loss of the best human resources of the group; absence of appreciable cost synergies not having the two groups overlapping distribution networks “.

The operation lacks a financial rational as it involves: a strong prejudice to the income profile of Mediobanca, whose profits on a Stand Alone basis are provided to be growing as required by the plan in execution, while the consensus sees for MPS a decline in profits for the reduction of the margin of interest and the progressive disappearance of the tax benefits; a dilution of the evaluation multiples of Mediobanca for the loss of the expected growth of revenues and profits, of the high profitability (double of the future one for the MPS net of a normalized tax-rate), of the almost nothing exposure to the small businesses segment, of growth, also of weight, of the WM; The drop in the mps title After the announcement, he testifies to the fragility of the stock exchange course, which makes the successful outcome of the operation unlikely.

Relevant share intertwining of Delfin and Caltagirone

Mediobanca also indicates that the operation is characterized by “Relevant share intertwining of Delfin and Caltagirone“, Which are present: in Mediobancawhere Delfin holds 20% and 7% Caltagirone (based on the detachment of the dividend in November 2024), in MPSwhere Delfin is the first private shareholder with 10%, while Caltagirone holds 5% (in addition to holding 5% of soul which in turn has 4% of MPS), in generalwhere Delfin holds 10% and 7% Caltagirone.

The presence of the same shareholders in Mps, Mediobanca and Generali as part of an offer exclusively in actions, configures “a potential dysomogeneity in interests compared to the rest of the equity team “.

The Board of Directors press release was approved with the abstention of councilors Sandro Panizza and Sabrina Pucci (expression of Delfin and minorities).

Siena’s reply: “Industrial nature is obvious”

Sources close to the operation launched on Mediobanca by MPS, after the Piazzetta Cuccia press release that rejected the OPS, point out that “the Industrial nature of the business combination proposal is so obvious That Mediobanca itself has decided to include the same consumer credit for some time now in its perimeter, and it is certainly not a business linked to investment banking, but it is much more in the strings of a commercial bank “. For the same sources, “it will not therefore not be this operation to affect the identity of that bank, which he already sees today Wealth Management and Corporate & Investment Banking contribute in aggregate to net utile for only the About 35%almost as much as compass that contributes for about 30%.

There part of the lion do the profits of Generaliwhich contribute to about the 40% of the net result of Mediobanca, on which the costs of the central functions negatively impact “. We should deduce – they explain – “that it is to the latter, although there is no trace in the press release, that Mediobanca refers when it indicates a focus on segments of value added activities and growth trends. And it is always the 13% share of Generali To have also contributed important to the growth of the Market Cap of Mediobanca, a share that if purged leads to a market value lower than that of Montepaschi “.