UniCredit Faces Rejection of $10.5 Billion Banco BPM Takeover Bid

Banco BPM's board cites insufficient value and autonomy concerns, while the Italian government signals scrutiny over the unsolicited offer.

Banco BPM's board unanimously rejected UniCredit's $10.5 billion all-stock offer, citing inadequate valuation and risks to its legal autonomy and profitability.
The Italian government expressed concerns over the bid, with Economy Minister Giancarlo Giorgetti referencing potential use of 'golden power' laws to block the deal if deemed against national interests.
UniCredit CEO Andrea Orcel framed the bid as a strategic move to consolidate Italy's banking sector, but political resistance and skepticism from investors have emerged.
Banco BPM's shares rose above the offered price, signaling market expectations for a higher bid, while UniCredit's stock declined following the announcement.
The proposed merger would create Italy's second-largest bank, but faces hurdles from Banco BPM's existing partnerships and political ambitions to establish a third major banking group in Italy.