MILAN. Piazza Meda lets go of Rocca Salimbeni. The Board of Directors of Banco Bpm met to analyze the status of the potential merger with Mps proposed last June 7, followed the next day by the takeover bid launched by Intesa Sanpaolo. And after the extraordinary board meeting on a very hot Friday, July 31, the board decided to close the Siena dossier, stopping everything. The Bpm board considered that, “almost two months after sending the Letter, the conditions to reach a shared agreement between the parties,” that is with Montepaschi, “have not yet been met.” The board of the former Milanese popular bank communicated this in a press release issued on the evening of July 31, “while reaffirming the strong strategic and industrial rationale potential of the project proposed to Mps with the letter – which could have led to the creation of a new leading banking and financial group in Italy, generating significant value creation for both banks.”
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And so at the banking risiko table aiming at Monte dei Paschi di Siena, with the 13% stake of Generali held by Mediobanca, only one player remains now, that is Intesa. The bank led by CEO Giuseppe Castagna from Piazza Meda in the official statement following the board meeting announced that “also in the spirit of maximum transparency towards the market and all shareholders, the Banco board” has therefore “unanimously resolved to interrupt consultations regarding the potential merger, simultaneously notifying Mps.”
A communication that in these hours has put an end to Bpm’s game on Siena, a game that had started with the communication of last June 7, in which it had expressed to Mps “its interest in starting a dialogue aimed at discussing and agreeing on the terms of such operation, as well as the subsequent events.” Banco Bpm’s withdrawal from the merger with Montepaschi comes after a scorching day weather-wise but started with a cold shower when Crédit Agricole, the majority shareholder of Piazza Meda with 29.3%, put a hard brake on a merger hypothesis with Rocca Salimbeni. Olivier Gavalda, CEO of the French group, said “any operation involving Bpm must create long-term value for Credit Agricole and other shareholders.
With our 29.3% stake in July, we are by far the largest shareholders and therefore will have a say on any operation involving the company and will analyze any solid project with regard to its strategic interest, execution risk, and ability to create long-term value. As always, there are many scenarios on the table, but at the moment we are not aware of any concrete project between Mps and Bpm and have not been contacted by other parties regarding potential involvement in such a project. At this stage, it is very difficult to imagine how a combination between Montepaschi and Bpm could create value for shareholders.”
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And the CFO of the ‘banque verte’ Clotilde L’Angevin had declared that “to date, authorization from the ECB for control of Bpm has not yet been requested and that the “preferred scenario” at most would be a merger with Credit Agricole Italy. But according to what leaked after the extraordinary board meeting from Piazza Meda, the decision not to proceed with an equal merger with Siena dates back to recent days and is not strictly related to the position expressed by the top management of the French banking group.
The extraordinary board meeting of Piazza Meda was initially scheduled for late Thursday, July 30, the day before the statements from the ‘banque verte’ during the half-year results presentation call to the financial community, then postponed to Friday, July 31. In the decision to stop the talks, according to Banco sources, the timing that was emerging two months after the June 7 letter with the proposal to Mps weighed heavily: waiting for a response, a situation was developing in which the timing to define the operation to present to the market and shareholders was no longer visible, especially with another market offer, that of Intesa Sanpaolo, the bank led by Carlo Messina, already defined and with a precise schedule.
Late in the evening, the institute led by CEO Luigi Lovaglio issued an official statement acknowledging the choice made by Piazza Meda: “Banca Monte dei Paschi di Siena takes note of the considerations made today by Crédit Agricole during the presentation of the half-year results and the position subsequently expressed by the Board of Directors of Banco BPM which, while reaffirming the strong strategic and industrial rationale potential of the project referred to in the letter of last June 7, has resolved to interrupt consultations, considered by Mps preparatory to a possible subsequent negotiation phase. – reads the note – The Bank remains focused on implementing its growth plan and integration with Mediobanca, and will continue to evaluate every strategic option in the interest of all stakeholders.”
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