Monte dei Paschi makes €13bn bid for Mediobanca

Italy is saved Monte dei Paschi di Siena on Friday launched a 13.3 billion euro ($13.95 billion) all-share takeover bid for a larger domestic partner Mediabank.

Shares in Monte dei Paschi (MPS) fell 5.74% at 09:43am London time, with Mediobanca up 6.28%.

Offering 23 of its shares for 10 of its acquisition target, Monte dei Paschi values ​​Mediobanca shares at approximately €15,992 each, a 5% premium to the January 23 closing price.

Monte dei Paschi’s capital was worth 8.7 billion euros at the close on Jan. 23, while Mediobanca’s market capitalization stood at 12.3 billion euros, according to FactSet data.

CNBC has contacted Mediobanca for comment.

Monte dei Paschi, the world’s oldest bank, needed a government bailout in 2017. after years of crippling losses, but turned the tide of its fortunes under the leadership of UniCredit veteran Luigi Lovaglio. The Italian government retains an 11.73% stake in the lender.

“The transaction could contribute to completing the dynamics of the Italian financial system, in the context of strong consolidation,” Italian banking union Fabi said after the offer was announced, according to a translation by CNBC. “MPS, historically at the center of complex events, is now moving in an ambitious direction. The offer confirms, among other things, that MPS has fully recovered.”

Friday’s offer adds to a picture of heating up M&A appetite in Italy’s banking and financial services sector, where the country’s second-largest bank UniCredit previously offered to buy BPM Bankwhich in turn is seeking to acquire fund manager Anima Holding. Monte dei Paschi itself was a potential takeover target for UniCredit until talks recently broke down in 2021.

— CNBC’s Silvia Amaro and Ganesh Rao contributed to this report.

This breaking news is being updated.