Italian Bank Intesa Sanpaolo To Pay 4.86B For Ubi Banca
The largest banking group in Italy, Intesa Sanpaolo, unexpectedly made an offer to acquire the country’s fourth largest bank, Ubi Banca.
“Our industry has entered a new phase at the European level, which requires a large scale, wider investment opportunities and the application of a new financial model. Thanks to this operation, the bank, which will be born as a result of integration between Intesa Sanpaolo and Ubi, can become one of the leaders European banking system, » said Intesa Sanpaolo group leader Carlo Messina on Tuesday.
The offer involves payment only by shares: for every 10 shares of Ubi Banca, its shareholders will receive 17 shares of Intesa Sanpaolo of a new issue. Thus, one share of Ubi Banca was valued at €4.254, and the whole group – at €4.86 billion. This is significantly more than the bank’s market price, according to the latest quotes of its shares. Nevertheless, Intesa Sanpaolo expects to achieve an increase in net profit growth of up to €6 billion starting in 2022, bank’s message reads.
On Monday, Ubi Banca presented to investors a new development plan, which provided for the closure of 175 branches and the reduction of 2 thousand jobs.
The transaction proposed by Intesa Sanpaolo has yet to be approved by the Italian antitrust and supervisory authorities. Apparently, the largest bank in the country has already reached preliminary agreements with other participants in the Italian financial market. So, BPER Banca is ready to buy from Intesa Sanpaolo part of the business related to serving 1.2 million customers in the north of Italy in the event of successful completion of Ubi Banca’s acquisition.