Monte dei Paschi di Siena launches €34bn defense against Intesa Sanpaolo

Monte dei Paschi di Siena (MPS) has approved a strategic counter-maneuver to defend against a €30.6 billion takeover attempt by Intesa Sanpaolo. Led by CEO Luigi Lovaglio, the MPS board approved a plan involving two separate voluntary exchange offers targeting Banco BPM and Banca Generali.

The dual operation, valued at approximately €34 billion, aims to establish a major Italian banking group capable of competing among the top ten in Europe. To secure shareholder support, MPS has proposed an extraordinary dividend package totaling €4 billion, consisting of €1 billion in cash and €3 billion in Assicurazioni Generali shares. This move also facilitates a gradual divestment of MPS’s historical stake in Generali.

The plan faces several hurdles, including market skepticism, geopolitical complexities regarding shareholders, and internal friction within the MPS board, where four minority independent directors abstained from the vote. Intesa Sanpaolo is reportedly evaluating a complaint to Consob regarding the situation. Shareholders are expected to vote on the proposal in late October.