Banca Generali estudia la oferta de Monte Paschi

Banca Generali is reportedly assessing an unsolicited offer from Monte dei Paschi di Siena (MPS), as part of Monte Paschi's executive director, Luigi Lovaglio's attempt to create a massive Italian bank with a stock market valuation of around 70 billion euros. Banca Generali stated it will express its opinion on the offer within the timelines and in accordance with the procedures set by law, according to a company statement over the weekend.

It is worth noting that the offer was not solicited or previously agreed upon by Banca Generali. Monte Paschi announced on Friday it is seeking to buy both Banca Generali and Banco BPM, presenting all-share bids that value the companies at 8.7 billion euros and 25.3 billion euros respectively, based on closing prices on August 19.

These moves aim to thwart a potential acquisition of Monte Paschi by its rival Intesa Sanpaolo, which submitted an offer about two months ago. The resulting entity would be the only national bank remotely approaching the size of the two dominant banks in the country, Intesa and UniCredit. Monte Paschi has moved from defense to all or nothing, according to Nicolas Marmurek, co-head of special situations at Square Global Markets.

The idea is to make Intesa's offer seem like a dismantling offer against a larger national banking platform. A previous idea for Monte Paschi to carry out a merger between equals with Banco BPM fell through, ending what appeared to be Lovaglio's preferred defensive option. Banca Generali's shares fell around 2% on Friday upon learning of the offer, indicating investors consider it unlikely the agreement will materialize, according to experts on Italian entities. Monte dei Paschi's stocks slipped 1.3%.