Shares of Italian bank Carige surge after BPER Banca offer


The Carige Bank logo is seen in Rome, Italy on September 20, 2018. REUTERS / Max Rossi

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MILAN, Dec. 15 (Reuters) – Shares of Italian lender Carige (CRGI.MI) rose more than 15% on Wednesday after a surprise takeover approach by rival BPER Banca (EMII.MI).

Carige, loss-making, has been seeking such an agreement since its bailout by the Italian depositor protection fund FITD in 2019, offering BPER the opportunity of an acquisition that would make it the fourth Italian lender.

BPER shares rose more than 6% after the announcement of the non-binding offer on regional bank Carige on Tuesday evening.

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A deal between the two midsize lenders could also kick-start consolidation in Italy’s banking sector after UniCredit’s (CRDI.MI) failed state acquisition of Monte dei Paschi di Siena (BMPS.MI) by UniCredit (CRDI.MI) this year. .

BPER is also considered a good merger candidate for the Popolare di Sondrio regional bank (BPSI.MI).

On Tuesday, BPER announced that it had made a non-binding offer to FITD to buy 88.3% of Carige for 1 euro ($ 1.13).

FITD, funded by contributions from Italian banks, has an 80% stake in the regional bank and is looking for potential suitors. Cassa Centrale Banca holds 8.3%.

As part of the proposed deal, BPER also asked FITD to provide a capital contribution of € 1 billion ($ 1.13 billion) to Carige to cover costs associated with the deal and reduce the risk arising from Carige’s loan portfolio.

“The transaction would allow BPER to buy Carige at a compelling valuation. However, value creation is not evident at this point,” Jefferies analysts said, adding that more clarity was needed on the savings and the potential costs of the restructuring of Carige.

Carige’s board is scheduled to meet later Wednesday and a FITD meeting is scheduled for Thursday.

The FITD meeting is expected to consider BPER’s proposal, two banking sources told Reuters, adding that the final decision would depend on the willingness of Italian banks to contribute € 1 billion to finance the operation.

If the deal goes through, BPER has announced that it will launch a mandatory takeover bid on the remaining Carige shares at € 0.80 per share, including a 29% premium over its closing price on December 13.

($ 1 = 0.8875 euros)

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Reporting by Francesca Landini and Andrea Mandala Editing by David Goodman

Our Standards: Thomson Reuters Trust Principles.


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