Risiko is heating up again; Unicredit is navigating various scenarios with a target price of 100 euros

(Il Sole 24 Ore Radiocor) - Bank shares are rising on the Milan Stock Exchange, whilst investors are pondering the new landscape that could emerge in Italia over the coming months, in light of the consolidation moves launched in recent days. The focus is on Banca Monte, which is being courted by both Banco Bpm and Intesa Sanpaolo, the latter in partnership with Unipol. Among the sector’s shares, UniCredit stands out as the best performer, on a day when Berlin rejected the bid for Commerzbank, deeming the Italian group’s approach ‘aggressive’.

According to a statement from the German Federal Finance Agency (Finanzagentur), the offer does not offer ‘a sufficient premium’ compared with the current market price of Commerzbank shares. The deal is politically sensitive in Germany, given that the federal government, with a 12 per cent stake, remains the second-largest shareholder in the Frankfurt-based bank. Beyond the financial assessments of the bid, Berlin emphasises that Commerzbank ‘plays a key role in financing the German economy and the Mittelstand’, the fabric of small and medium-sized exporting enterprises, and represents ‘a major employer and an essential pillar of the Frankfurt financial centre’, which the government intends to preserve. The government’s position comes on top of the complaint lodged by the bank’s employees regarding possible manipulation of the data relating to the bid. These allegations have been firmly rejected by UniCredit.

The German resistance, however, is mounting on the final day available to accept the public exchange offer launched by Unicredit, even though from Wednesday 17 June the two additional weeks provided for under German law will come into effect. During Monday’s trading session, it emerged that acceptances had raised Unicredit’s stake in Commerzbank to 55.09 per cent of the share capital, taking into account both acceptances of the offer — which rose to 11.91 per cent of the share capital from the 11.86 per cent recorded on Friday — and the shares already held and positions in derivatives.

At this stage, the German campaign is becoming increasingly complex for the CEO, Andrea Orcel, and is reinforcing the belief among many observers that the executive may once again be considering an active role in the consolidation of the Italian banking sector. In particular, the market is speculating on the possibility that Unicredit is once again considering a deal involving Banco BPM, following the halt imposed by the restrictions set by the government. Such a move could represent the first step towards a subsequent merger with MPS, which has come under the scrutiny of Intesa Sanpaolo and Unipol. This latter scenario, however, is causing concern in Siena, where there are fears that the world’s oldest bank might be broken up.

Meanwhile, Banco BPM’s chief executive, Giuseppe Castagna, has made it clear that he has not thrown in the towel and continues to pursue the idea of creating a group comprising Banco BPM and MPS. “This year we are engaged in another major operation, in which we are up against a giant that is seven or eight times our size. This is the spirit of sport: not giving up, continuing to give your best and trying to do everything possible.” Some clues may emerge at the end of Banco Bpm’s board meeting, the first since the merger proposal put forward to MPS in recent weeks and prior to the launch of Intesa Sanpaolo’s bid.