After being suspended for over three hours, Banco Bpm rises by 6.5% to 3.44 euros for a capitalization of 5.21 billion. Il Messaggero wrote that Unicredit could launch a takeover bid this weekend on the group led by CEO Giuseppe Castagna. This morning a No comment arrived from Unicredit itself. The institute led by CEO Andrea Orcel also recently recalled that M&A operations must comply with precise conditions, that is, not to affect the distribution capacity, accelerate the business, have a strategic sense and generate value for shareholders.
At the end of the morning, a spokesman for the bank clarified “that as part of its business and in line with the 2022-2024 Strategic Plan, Unicredit continues to evaluate all the strategic options available and will not fail to keep the market informed of any concrete development “. The Milanese institute then specified that “no extraordinary meeting of the board of directors has been called”. The stock opened lower this morning, yielding 1.10% to 15.68 euros in Piazza Affari for approximately 35 billion. Financial circles explained to that no maneuver would be in progress because there would be no conditions for a merger in line with the objectives and conditions.
Today Equita Sim (rating buy, target price of 16 euros on Unicredit) writes that the merger hypothesis “would have a strong industrial rationale as it would significantly strengthen the competitive positioning of the group in Italy in absolute terms”. The Milanese bank would go from a market share of 11% to 18%, especially in the North (here the share would double from 10% to 20%), reducing the differential compared to Intesa Sanpaolo. Based on the calculations of the Milanese SIM, the group that would be created would have a Cet 1 of around 13% and a capital buffer compared to the minimum levels required by the ECB (the Srep) around 400 basis points (and 4%).
Mediobanca Securities today confirms the outperform rating and the target price of 19.00 euros on Unicredit. Piazzetta Cuccia analysts recall that the shares of the Milanese bank have recovered 40% from the failure of negotiations to take over a perimeter of Mps, while in the same period Banco Bpm has grown by 20%, since “Unicredit’s standalone strategy , based on a solid capital base and shareholder remuneration via buyback and coupon, has been well received by the market “.
Analysts believe that the stock could be subject to a re-rating thanks to the accounts and remember that the CEO Orcel has always been clear in his communication: the 16 billion euros of return on capital belong to the bank’s strategy and a possible transaction of M&A must be compatible with this benchmark. That is: first to remunerate the shareholders, then to carry out extraordinary operations. Mediobanca expects the purchase plan worth 3.75 billion euros to be launched.
Fabio Caldato, partner of Olympia Wealth Management, explains to that “the rumors about the possible integration between Unicredit and Banco Bpm are repeated periodically. There are no certainties, but certainly we have always favorably judged a copy and paste operation of the one between Intesa Sanpaolo and Ubi Banca “. The manager considers it appropriate to underline that from the stop to negotiations between Unicredit and Mps, “the former has recovered about 40% in value, with Banco Bpm at about + 20% in the same period of time. Investors have rewarded the prudent strategy, based on the return on capital and prices today are less biased in favor of Banco Bpm than a few months ago “. The two elements appear, according to Caldato, to “support the possible operation”.
According to Kepler, the operation was not interesting last autumn because Banco Bom was traveling above 3 euros and Unicredit was under 10 euros while today it moves above 15 euros “. And even if the press rumors were unfounded,” the operation would make sense because it would allow Unicredit to strengthen its position on the Italian market and increase shareholder value. ”
Autonomous writes today that the continuous speculations on mergers and acquisitions” are not a surprise when you are dealing with a banker expert in the field at the helm of Unicredit and CEO Orcel did not exclude M&A transactions in the business plan “. A move now on Banco Bpm would be” understandable from the point of view of the assessment of the target bank and before the ECB raises rates by making themore expensive operation.
JP Morgan recalls that Unicredit has “4-6 billion excess capital in the business plan and has never ruled out M&A”. (All rights reserved)

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