Mps raises with 750 million cash to acquire Mediobanca

Mps relaunches on the Mediobanca takeover bid. The bank led by Luigi Lovaglio has revised upwards the public exchange offer on Mediobanca by including a cash component in the operation: EUR 0.9 per share, corresponding to a total outlay of approximately EUR 750m. Mps has also announced that it is waiving the 66.67% threshold condition to which the effectiveness of the offer for Mediobanca was subject, while the 35% unconditional threshold remains confirmed. Lastly, Mps confirms that the offer for Mediobanca will end on 8 September, but the Monte had already provided for a five-day reopening of the deadline, between 16 and 22 September. Finally, the bank recalls that those who have already taken up the offer will also benefit from the adjustment.

The transaction envisaged an exchange of 2.533 Mps shares for each Mediobanca share and, at the stock market price on Monday 1 September, the discount stood at around EUR 640 million. For this reason, the board of the Sienese institution chose to proceed with the increase of the offer in the upper part of the range set between 500 and 700 million to be added to the share exchange with the inclusion of the cash component. The objective: to convince that 35% of institutional investors to hand over the securities. The board of directors of Mps "firmly believes that the increase in the consideration represents further concrete evidence of the industrial value of the operation and of the offeror's attention to the market, with the aim of maximising adhesions to the offer and accelerating the creation of value," reads the note issued by Mps. The cash relaunch decided by Mps for Mediobanca will cost the Monte approximately EUR 750 million. "Bmps' financial objectives remain unchanged, aimed at maintaining a strong capital strength and a dividend policy at the highest level in the sector, in the conviction that the commitment and the expected results will be appreciated by all stakeholders," the note reads. Despite the relaunch, Monte will maintain 'a solid capital base' with a pro-forma Cet1 of around 16% and 'a dividend policy sustainable over time with a pay-out ratio of up to 100% of profit'. On the basis of the official price of Mps shares of 6.953 recorded on the reference date of 23 January 2025, the note reads, the consideration expresses a monetary valuation of 16.334 per Mediobanca share and thus incorporates a premium of 11.4% over the official price of Mediobanca shares on the reference date of 15.227.

Having revised the offer upwards, at this point more signs seem to herald that the road to Siena is now downhill. Meanwhile, because the 'hard core' of shareholders at Piazzetta Cuccia has crumbled, now representing only 6.91% of the capital. The latest movements this week, recorded in an updated extract of the shareholders' agreement, have seen a downsizing of the bank's historical shareholders. It is true that this is only a consultation agreement, but in February, with a share strengthened to 11.87%, that same hard core of shareholders had rejected Mps' offer, calling it inadequate and aligning themselves with the position already expressed in even harsher words by Mediobanca's board of directors.

The downsizing of the pact therefore reshuffles the map of Piazzetta Cuccia's shareholders and with it those of possible adhesions. The CEO of Mps Luigi Lovaglio, who has subordinated the effectiveness of the offer to the attainment of at least 35% of Piazzetta Cuccia's capital, can count on the support of Delfin and the Caltagirone group, owners of almost 30% of Mediobanca, and to whom almost all the securities contributed so far to the takeover bid refer, amounting to 28.7% of the capital. But inclined to hand over their shares could also be those investors - holders of around 12% of Mediobanca - who with their abstention scuttled the offer for Banca Generali with which Piazzetta Cuccia hoped to free itself from the embrace of Siena.

In the meantime, the reference is to the Enasarco, Enpam, and Cassa Forense pension funds, which together hold a stake of around 5% in Siena. The Ente nazionale di previdenza e assistenza medici has already let it be known that it will hand over its Mediobanca shares to Mps. It is understood that the managers dealing with the stake on behalf of the doctors' and dentists' welfare body, which owns about 2% of Piazzetta Cuccia, have positively assessed Mps' proposal, which was enriched today by a cash component of EUR 0.9 per share.