MPS confirms itself as one of the most important issues in Italian banking risk. On the one hand there is the public purchase and exchange offer (Opas) launched by Intesa Sanpaolo together with Unipol, on the other the aggregation proposal put forward by Banco Bpm. For the moment, the Board of Directors of the Sienese bank has not made a definitive decision and has entrusted the advisors with the task of analyzing the different scenarios.
The last Board of Directors has in fact confirmed that the evaluation activities are continuing both of the offer notified by Intesa Sanpaolo and of the possible integration operation proposed by Banco Bpm. A choice that demonstrates Monte’s desire not to close any doors and to carefully verify which path can create greater value for shareholders.
The two options on the MPS table
The issue is double and concerns, as is known, two very different possible operations. The first is the takeover bid presented by Intesa Sanpaolo, notified two weeks ago, which aims to further strengthen its position in the Italian banking system through the integration of Monte dei Paschi.
The second is the proposal put forward by Banco Bpm, which instead aims to create a large alternative banking hub, capable of competing with the main groups in the sector. According to estimates presented by the Bank, the combination could generate synergies exceeding one billion euros before taxes.
At the moment neither of the two options has been formally accepted. The Board of Directors of the Siena institute preferred to maintain a prudent position, continuing the analyzes with the support of financial and legal consultants.
Because the Board of Directors has not yet made a decision
The caution did not surprise observers. The operations on the table have very significant implications from both an industrial and financial perspective. The advisors appointed by MPS continue with assessments that cover aspects such as the value of the offers, the impacts on shareholders, growth prospects and any regulatory critical issues.
In such a complex situation, the Board of Directors has chosen not to say too much ahead of time. The objective is to understand which scenario can guarantee the best balance between industrial development and economic return for investors.
Furthermore, according to several analysts, Monte dei Paschi di Siena could try to use this negotiation phase to obtain more favorable conditions in any negotiations with interested parties.
What does Mediobanca’s reorganization plan include?
In the meantime, the group’s industrial project continues and Intesa Sanpaolo’s takeover bid does not stop the reorganization of Mediobanca. The boards of directors of MPS and the subsidiaries involved have approved a reorganization which affects some activities currently attributable to the Monza institute.
The plan involves a redistribution of assets between various group companies and represents one of the central steps of the strategy outlined by CEO Luigi Lovaglio. The operation will however have to go through further authorizations and through the vote of the extraordinary meetings scheduled in the coming months.
As far as management is concerned, the reorganization represents a fundamental step in increasing the group’s efficiency and enhancing its strategic assets regardless of developments in banking risk.
How much MPS could be worth after the reorganization
It goes without saying that one of the aspects that investors are observing most carefully concerns the possible impact of the reorganization on the value of Monte dei Paschi di Siena.
According to various assessments, the complete integration of the activities linked to Mediobanca could allow MPS to incorporate further asset value currently not fully reflected in the market capitalisation.
This is undoubtedly one of the elements why the group is carrying forward its industrial plan in parallel with the offers received. In other words, MPS aims to strengthen its negotiating position by demonstrating that it has an autonomous strategy and a growth path already defined.
