In a dramatic reversal, Unicredit has formally withdrawn its takeover offer for Banco BPM after Italian market regulator Consob extended its freeze on the operation for a further 30 days. CEO Andrea Orcel and the board concluded the bid’s core condition regarding Golden Power authorization could not be met within the necessary timeframe.
This abrupt decision ends one of the most protracted and troubled banking operations in recent years, with no prospect of revival. “My primary responsibility is to act in the best interests of Unicredit and our shareholders,” stated Orcel. “The persistent uncertainty surrounding the application of the Golden Power prescriptions benefits neither party. We have therefore decided to withdraw our offer.” Orcel had consistently signalled withdrawal was possible if the offer’s fundamental conditions collapsed.
Unicredit, headquartered at Piazza Gae Aulenti, asserted the Golden Power clause, persistently invoked by Banco BPM’s leadership, critically disrupted the process. This prevented Unicredit “from engaging” with Banco BPM shareholders (Piazza Meda) as a normal offer procedure would permit. The bank contends Banco BPM’s management deprived its own shareholders of the customary dialogue during an offer period to evaluate the merger’s value and determine acceptable conditions.
Unicredit (shares flat at €58 on the Milan exchange) acknowledged significant progress with Italy’s Regional Administrative Court (TAR), the EU’s DG Comp, and the Italian government. However, it stressed that resolving the Golden Power issue definitively would extend far beyond both the offer deadline and Consob’s suspension period, forcing the withdrawal.
Unicredit highlighted the withdrawal as a missed opportunity not only for Banco BPM stakeholders but also for Italian business communities and the broader economy. The bank remains convinced that consolidating Italy’s banking sector would benefit both the country and Europe. “The combination of Unicredit and Banco BPM would have delivered enormous added value for all stakeholders,” stated Chairman Pietro Carlo Padoan. “The derailed offer process and ongoing uncertainty rendered this situation untenable.”
Unicredit reaffirmed its primary focus remains executing its transformation strategy. Mergers and acquisitions will only be pursued if they accelerate that strategy and enhance value creation, as the bank frequently states. “Unicredit’s strategy is excellent and its execution has always been our core focus. The results speak for themselves,” Orcel added, signalling the imminent release of Q2 and half-year results.
Banco BPM (+1.23% on the stock exchange) declined to comment. Market attention now shifts to potential moves by Credit Agricole, which may soon receive ECB approval to exceed a 20% stake in Banco BPM. Rumours suggest the French bank is preparing to increase its position.