The approval allows Intesa Sanpaolo to acquire at least 50% of the capital plus one share in UBI Banca along with the indirect acquisition of a controlling stake in the latter's online banking subsidiary IW Bank
Intesa Sanpaolo had launched a voluntary public exchange offer for UBI Banca takeover. (Credit: Uccio “Uccio2” D'Agostino/Wikipedia.org)
Italian banking group Intesa Sanpaolo said that it has secured prior authorisation from the European Central Bank (ECB) for the direct acquisition of a controlling stake in its smaller rival Unione di Banche Italiane (UBI Banca).
The approval allows Intesa Sanpaolo to acquire at least 50% of the capital plus one share in its rival Italian bank along with the indirect acquisition of a controlling stake in the latter’s online banking subsidiary IW Bank.
In February 2020, Intesa Sanpaolo launched a €4.86bn takeover bid to UBI Banca, which is said to have more than 1,600 branches in Italy, of which over 600 are in Lombardy, and about 150 are in Piedmont. The bank was founded in 2007 through the merger between Banche Popolari Unite (BPU) and Banca Lombarda e Piemontese.
Intesa Sanpaolo stated: “Following the authorisation received from the European Central Bank, Intesa Sanpaolo believes, although it does not currently have information on possible adverse effects of the COVID-19 pandemic on UBI Banca, that reasonably the pandemic should not bear such effects as to negatively affect the activity of UBI Banca and/or the financial, capital, economic and income situation of UBI Banca and/or the companies of the UBI Group.”
Intesa Sanpaolo, as per its voluntary public exchange offer, will issue 1.7 of its shares in exchange for every UBI Banca’s shares tendered with the transaction valuing the latter at €4.254 per share.
Why Intesa Sanpaolo wants to acquire UBI Banca
The Italian banking group, which has close to 5,000 branches in Italy and in other countries, expects its combination with UBI Banca to enhance the value creation of a European leader through a stronger presence domestically.
The combined Italian banking company is anticipated to focus on wealth management and protection, with presence in Italy which in turn will boost the country’s savings as per Intesa Sanpaolo.
The combined group will hold over €1.1 trillion in customer financial assets with almost three million UBI Banca’s customers, who hold nearly €200bn in financial assets.