Glass Lewis: in favour of Intesa’s increased bid for MPS, but Siena’s offers bring greater uncertainty

(Il Sole 24 Ore Radiocor) - Following Iss, Glass Lewis has also advised shareholders of Intesa Sanpaolo, ahead of the AGM on 10 September, to approve the capital increase to fund the takeover bid for MPS. According to the proxy report reviewed by Radiocor, the transaction “offers a credible strategic and financial rationale”, given that Intesa “would increase its exposure to wealth management and other commission-based businesses, including through Mediobanca”, whilst any overlaps will be managed through the agreement with Unipol. Furthermore, the terms ‘do not indicate an excessive payment’. Glass Lewis, however, notes that the exchange offers launched by MPS on Banco BPM and Banca Generali, together with the planned special dividend, ‘have significantly increased uncertainty regarding the scope to which Intesa’s offer will be directed’. Given that the offers have been submitted, in fact, “they cannot simply be dismissed as strategic alternatives”.

 The proxy notes that Intesa’s public takeover bid is conditional, amongst other things, upon there being no substantial changes to the scope of MPS, such as those that would occur if the proposed measures (the OPS and the extra coupon), and therefore Intesa is ‘significantly protected from having to proceed with the acquisition of a substantially altered MPS’. In such a case, in fact, ‘the reasonableness of proceeding with the acquisition would need to be reassessed’. Finally, Glass Lewis emphasises that ‘the outcome of Intesa’s offer could also be influenced by MPS’s relatively concentrated shareholding structure’, with Delfin holding 17.53 per cent, Caltagirone holding 10.26 per cent, and significant stakes held by the Ministry of Economy and Finance (MEF), Banco BPM and Blackrock. These shareholders’ positions will be significant not only for the acceptance of the public takeover bid but also for the vote at the MPS shareholders’ meeting on the optional public exchange offers on 29 October. Consequently, ‘the decisions of a relatively small number of major shareholders could substantially influence’ both Intesa’s Opas and MPS’s offers.

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