Italian banking group Intesa Sanpaolo has launched a €4.86bn takeover bid to its smaller rival Unione di Banche Italiane (UBI Banca).
As per its voluntary public exchange offer, Intesa Sanpaolo will issue 1.7 of its shares in exchange for every UBI Banca’s shares tendered. The transaction values the latter at €4.254 per share.
UBI Banca was created in 2007 through the merger between Banche Popolari Unite (BPU) and Banca Lombarda e Piemontese. Operating mostly in Italy, the bank has more than 1,600 branches in Italy, of which over 600 are in Lombardy, and nearly 150 are in Piedmont.
Intesa Sanpaolo has nearly 3,800 branches in Italy along with approximately 1,000 branches across other countries.
The banking group said that its combination with its rival will improve value creation of a European leader through a stronger footprint in Italy.
The enlarged Italian banking company is expected to focus on wealth management and protection, with presence in Italy which in turn will improve the country’s savings, said Intesa Sanpaolo. The combined group will hold more than €1.1 trillion in customer financial assets with nearly three million UBI Banca’s customers, who hold about €200bn in financial assets.
Intesa Sanpaolo stated: “The transaction will enable the combined Group to strengthen its support to the real economy and the social economy reinforcing its position as the first Bank in Italy with market shares of around 20% in all main business activities, enhancing creation and distribution of value by achieving significant synergies with no social impact and reducing risk profile at no extraordinary cost to shareholders.”
Intesa Sanpaolo’s plans to address antitrust issues arising from UBI Banca takeover
The Italian banking group said that to address antitrust issues pre-emptively, the transaction includes an agreement signed with BPER Banca. Under the agreement, BPER Banca will buy 400-500 branches of the enlarged Intesa Sanpaolo group.
The transaction also includes an agreement with UnipolSai Assicurazioni, which will buy certain insurance activities associated with the combined group’s branches.
Intesa Sanpaolo expects the transaction to be finalised by the end of 2020, subject to receipt of regulatory authorisations and meeting of certain conditions.
Recently, the banking group signed a deal to divest its merchant acquiring business to Italian paytech company Nexi Group for €1bn.
