Fresh efforts by Andrea Orcel, head of Italian banking giant UniCredit, for further consolidation of the sector are facing a new wave of rejection. While the attempted acquisition of the German bank Commerzbank launched at the end of September and denounced as hostile by Berlin is on hold, the Milanese group is now stumbling upon Banco BPM. BPM Bank considers that the operation launched on Monday, November 25 on the third largest Italian banking group, a public exchange offer worth more than 10 billion euros, does not reflect either its profitability or its value creation potential. It also aroused open hostility from the Italian government.
“We are a large autonomous bank, an Italian bank that aspires to be close to our regions and the small and medium-sized companies that constitute the backbone of our country”declared on Wednesday the president and CEO of Banco BPM, Giuseppe Castagna, in a letter addressed to his employees and cited by the Bloomberg agency. According to Castagna, 6,000 of the group’s 20,000 employees would be threatened by the restructuring that the UniCredit offer would imply. BPM also judged the conditions of the operation carried out by its rival “absolutely unusual”as it had not been the subject of a prior agreement, and that the merger would cause the bank to lose its legal autonomy and would reduce competition in the Italian market.
The turbulence caused by Andrea Orcel’s new takeover attempt confirms UniCredit’s intense appetite for its rivals and its director’s willingness to get straight to the point, even if it means suffering the repercussions of a particularly aggressive approach. Orcel, 61, who came to the management of UniCredit in 2021, has a reputation as a virtuous negotiator. In his previous position at the investment bank Merrill Lynch, he oversaw major mergers in the financial sector, including, in 1998, the one that gave rise to the group he heads today and whose stock market value has increased 390% since his arrival.
A “foreign bank”
At the end of September, UniCredit’s surprise acquisition of 9% of Commerzbank, followed by the announcement of an increase to 21% of the capital, was hailed as the most spectacular operation known to European finance since the 2008 financial crisis. merger with UniCredit was also part of the logic of consolidation of the sector on a continental scale requested by the former presidents of the Italian council Mario Draghi and Enrico Letta, authors on behalf of the European Commission, reports on competitiveness and the single market, respectively. If the maneuver received the support of the European Central Bank, it aroused clear hostility from the German government. Since then, the operation has been paralyzed.
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