Unicredit, the Italian banking giant, has announced a voluntary exchange offer for Banco BPM, marking a significant move in the banking sector. The offer, valued at approximately €10.1 billion, proposes an exchange ratio of 0.175 new Unicredit shares for each existing Banco BPM share, implying a price of €6.657 per share.
This announcement has led to notable market reactions. Banco BPM shares surged by as much as 8% to reach a multi-year high of €7.206, while Unicredit's shares fell by 3.3%, reflecting investor concerns over the implications of the acquisition. Additionally, shares of Commerzbank, another target of Unicredit's ambitions, plummeted by over 4% in pre-market trading, with analysts suggesting that the focus on Banco BPM diminishes the likelihood of a Commerzbank takeover.
Unicredit CEO Andrea Orcel emphasized that this acquisition aims to strengthen the bank's position in Italy, creating a more competitive entity in a vital market. He anticipates that the deal will enhance earnings per share within two years of completion.
Market analysts predict that the integration of Banco BPM could yield annual cost synergies of approximately €900 million, alongside revenue synergies estimated at €300 million. However, concerns remain regarding the potential capital increase required to finance the acquisition, which could reach around 16% of Unicredit's capital.
The transaction is expected to be finalized by June 2025, with full integration projected within 12 months following the exchange offer. The move underscores Unicredit's strategy to consolidate its presence in Italy while maintaining a robust capital ratio.