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UniCredit Withdraws Banco BPM Offer Following Golden Power Intervention, Ups Profit Guidance

Rome’s golden power stipulations prevented UniCredit from engaging BPM shareholders under a normal offer process.

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Unicredit logo is seen displayed in this illustration taken, May 3, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
UniCredit shares rose more than four percent as investors reacted to the bank reporting a jump in second quarter profits and walking away from a fraught bid for rival Italian lender Banco BPM

Overview

  • UniCredit cited Italian government–imposed golden power rules as the reason its takeover bid was derailed by restrictive conditions on shareholder engagement.
  • The bank withdrew its offer for Banco BPM just before the bid period was due to expire on Wednesday.
  • On July 23, UniCredit reported a 25% year-on-year increase in second-quarter net profit to €3.3 billion including one-off items.
  • UniCredit raised its full-year net profit forecast to €10.5 billion, up from €9.3 billion, based on stronger-than-expected quarterly results.
  • The move underscores the friction between cross-border consolidation strategies and national sovereignty regulations within Europe’s banking sector.