(Bloomberg) -- Italy has emerged as a hotbed of European bank consolidation as multiple deals are set to transform the country’s finance industry, with knock-on effects across Germany, France and beyond.
UniCredit SpA’s surprise bid for Banco BPM SpA came just weeks after the smaller rival embarked on a takeover attempt of its own, offering to buy asset manager Anima Holding SpA and taking a large stake in Banca Monte dei Paschi di Siena SpA from the government.
A potential combination of Banco BPM and Monte Paschi is widely seen as a likely cornerstone in the government’s plan to form a third large banking group. UniCredit is trying to defend itself against the emergence of a new rival, while waiting to see how its move on German rival Commerzbank AG plays out.
The bids have pulled in other parties, from French bank Credit Agricole SA — Banco BPM’s biggest investor — to insurer Unipol Gruppo SpA, which owns stakes in banks and has indicated it’s willing to be involved in Monte Paschi. Then there’s a duo of wealthy families who have long played an active role in shaping the world of Italian finance.
Here’s a rundown of the main cast:
Andrea Orcel, CEO of UniCredit
As an influential dealmaker, Orcel helped transform Europe’s banking landscape over the past decades. Now leading his own institution, he’s making a push to build a pan-European bank and revive consolidation in the industry.
UniCredit’s offer for Banco BPM, valued at around $10.5 billion when it was announced, would vault it ahead of Intesa as the largest Italian bank by total assets. It has already allowed Orcel to complicate the plan by Banco BPM to acquire Anima and take a larger stake in Monte Paschi, by triggering a clause in Italian law that prevents the target of a takeover from taking certain measures to defend itself.
A separate effort by Orcel to take over Commerzbank, unveiled in September, is currently in limbo after Germany called early elections. That deal would create the biggest bank in Germany, where UniCredit already owns Hypovereinsbank, and would also allow Orcel to expand in Poland. Opposition from management and the German government have complicated it.
Giuseppe Castagna, CEO of Banco BPM
Castagna, who has run Italy’s third-largest lender for more than a decade, spent the last few years navigating threats of a hostile takeover by UniCredit and government attempts to create a new banking group around Monte Paschi. With Orcel seemingly distracted in Germany, he decided it was a good time to make his own moves.
In early November, Castagna launched a bid for Anima, in which Banco BPM was already the main shareholder. Shortly after, he acquired a 5% stake in Monte Paschi as the government sold down its stake.
Castagna needs the goodwill of the government because Anima’s second-biggest investor and one of its main clients is state-controlled Poste Italiane. Anima also took a stake in Monte Paschi last month. If both firms end up combining, they would own around 9% Monte Paschi.
Giorgia Meloni, Italy’s Prime Minister
The Italian government under Meloni would like to see Monte Paschi merge with another Italian bank to create a strong group in the wealthy northern regions. Monte Paschi is the world’s oldest lender and ensuring its survival as an Italian firm is matter of national pride, after years of government involvement.
As Rome seeks to return the firm to private ownership, it found willing buyers for part of its stake in Banco BPM and Anima, as well as some of the country’s wealthiest investors. But UniCredit’s latest turn left Rome in a bind. Meloni has been supportive of Orcel’s move to buy Germany’s Commerzbank, but warned the government has the power to intervene in the Banco BPM deal should it hurt national interests.
Philippe Brassac, CEO of Credit Agricole
The French bank has had its own growth plans in Italy for some time. It bought local lender Cariparma in 2007 and later expanded in asset management, retail, corporate and investment banking. It surprised the market in 2022 when it disclosed a roughly 9% holding in Banco BPM, prompting speculation that it may seek a takeover.
It’s stake in Banco BPM and a range of distribution agreements now make Credit Agricole a key player in the conflict between that lender and UniCredit, and in Rome’s plans for a new banking group. The French bank is the leading partner in consumer credit and non-life insurance joint-ventures with Banco BPM.
Credit Agricole’s asset management arm Amundi, on the other hand, relies on UniCredit as its key Italian distribution channel. That arrangement runs until 2027, but Orcel has been unhappy with the terms and tried to renegotiate them. Offering a potential extension of part of the contract could help the UniCredit CEO win over Brassac for his plan to acquire Banco BPM.
Francesco Gaetano Caltagirone and the Del Vecchio family
When Meloni’s government sold part of its stake in Monte Paschi last month, among the buyers it lined up were two billionaire investors who have long played an active role in shaping Italian finance. Delfin, the holding company of the family behind Ray-Ban maker EssilorLuxottica SA, took a stake of around 3.5%, as did Francesco Caltagirone, a building entrepreneur owner of the Messaggero newspaper. Caltagirone then raised it to 5%.
Delfin also owns about 10% in Italy’s biggest insurer Assicurazioni Generali SpA, 20% of investment bank Mediobanca SpA and around 3% in UniCredit. Caltagirone owns major stakes in most of those firms as well. Given their track record as activist shareholders, they’re likely to play a key role in how the Italian banking drama plays out.
Alessandro Melzi d’Eril, CEO of Anima
Melzi d’Eril has limited options to push back against Banco BPM’s approach, because the three biggest clients of the Italian asset manager are Banco BPM, Monte Paschi and Italy’s state-controlled Poste Italiane. Banco BPM and Poste Italiane are also Anima’s biggest shareholders.
When Banco BPM launched its €1.6 billion all-cash takeover bid, Castagna said he was “confident that Anima’s board will see this as a friendly takeover offer.” In a signal both sides are indeed aligned, Anima took part in the government’s sale of Monte Paschi shares last month.
Carlo Cimbri, Chairman of Unipol
Cimbri, known as a great strategist, has expanded the reach of Unipol through large stakes in BPER Banca SpA and Banca Popolare di Sondrio. BPER has been considered as the only alternative to Banco BPM as a potential partner for Monte Paschi in the creation of a new national champion.
In September, Cimbri said that Unipol would review the opportunity to buy a small stake in Monte Paschi if that deal included a distribution agreement. His message was rebuffed by the government, which preferred to sell its stake to Banco BPM. But with BPM in the crosshairs of UniCredit, he could yet play a key role in the future of Monte Paschi.
Carlo Messina, CEO of Intesa Sanpaolo
Messina surprised analysts and investors several years ago with a hostile takeover offer for UBI Banca, a move similar to what Orcel is now proposing at Banco BPM. The deal turned Intesa into the country’s largest bank.
He has said that the bank’s market share means he can’t make more acquisitions in the country and ruled out becoming a “white knight” for Banco BPM. But as a CEO who has pursued a number of deals himself, a cameo role wouldn’t come as a total surprise.
--With assistance from Thomas Hall.
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