UBI Banca is reportedly considering alternative merger plans to ward off Intesa Sanpaolo’s unsolicited €4.9bn hostile bid.
Rather than a target, UBI Banca is looking to become a buyer of weaker rival banks, Reuters has reported citing undisclosed sources.
It has appointed Credit Suisse to outline its defence strategy, the sources told the publication on condition of anonymity.
As part of its defence, the Italian banking group may consider a takeover of ailing rival Monte Dei Paschi.
Monte Dei Paschi was bailed out by the Italian government in 2017 with an investment of an €8bn.
The talks, according to Reuters report, are at an initial stage now and UBI has yet not finalised if it wants to chase an alternative deal to Intesa’s hostile bid, the sources added.
In case Intesa Sanpaolo’s deal materialises, it would lead to the creation of the seventh-largest group by assets in the eurozone with €1.1trn in assets.
The combined group would increase Intesa’s client base by three million.
Furthermore, a shareholder group of UBI Banca, which owns 18% of the Italian bank’s share capital, has rejected Intesa Sanpaolo’s bid for the bank.
It described the deal as “hostile, unsolicited and not consistent with UBI Banca’s underlying values”.
The shareholder group made unanimously approved statement after Intesa Sanpaolo CEO Carlo Messina expressed confidence in the success of the bid.
Messina also denied any possibility of a deal being further sweetened.
Last month, reports emerged that the Italian treasury is exploring merger options for troubled lenders Banca Carige and Monte Dei Paschi in a bid to prevent another downturn in the banking sector.