Delfin backs Intesa Sanpaolo's bid for Monte dei Paschi di Siena
Delfin, the holding company of the Del Vecchio family and the largest shareholder in Monte dei Paschi di Siena with a 17.6% stake, has committed to supporting Intesa Sanpaolo's public purchase and exchange offer for the Tuscan bank. The company announced it will tender its entire shareholding of 534,676,825 shares into the offer and will vote in line with Intesa Sanpaolo's conditions at the shareholder meeting convened for 29 October in Siena.
The decision by Delfin's board of directors came after Intesa Sanpaolo unexpectedly raised the cash component of its offer by 25 cents per share, bringing the cash portion to €1.25 per share. The total offer values each Mps share at approximately €10.34, representing a 12.5% premium to the share price on 16 July 2023. If fully subscribed, the offer would be worth around €31.4 billion, with €3.8 billion in cash.
Intesa Sanpaolo, led by chief executive Carlo Messina, framed the 29 October meeting as a "referendum" on the future direction of Monte dei Paschi. The bank stated that its offer will become "definitively ineffective" if shareholders approve any part of the alternative plan presented by Mps chief executive Luigi Lovaglio.
A complex alternative
Lovaglio's plan, announced on 21 August, involves two simultaneous exchange offers for Banco Bpm and Banca Generali, two listed companies at the top of complex financial groups. Intesa Sanpaolo described the structure as "particularly complex" and "without precedent in the Italian market for intermediaries subject to prudential supervision."
The two offers are legally separate but economically interdependent, making valuation difficult for shareholders of Mps, Banco Bpm and Banca Generali, according to Intesa's assessment. The plan also includes transferring the Generali stake held by Mediobanca to Mps, which already owns 13.3% of Generali.
Intesa Sanpaolo warned that approving Lovaglio's strategy could affect the independence of Generali, which Mediobanca has guaranteed for decades. The simultaneous presentation of two exchange offers "at a discount is entirely unusual in the market, with implications for the concrete prospects of success," the bank stated.
What happens next
The coming weeks will determine the outcome of what Italian media have described as a high-stakes battle in the banking sector. Several key dates lie ahead:
• Mid to late October: The European Central Bank is expected to rule on regulatory authorisations for Intesa Sanpaolo's offer.
• 29 October: Mps shareholders meet to vote on Lovaglio's plan.
• Late October to early November: The offer is expected to be filed with Italian markets regulator Consob.
• Late November: An Antitrust decision on the offer's competitive impact is due, followed by a ruling on golden power.
Proxy advisors ISS and Glass Lewis are expected to issue their voting recommendations before the shareholder meeting. Large investors rarely diverge from these guidelines. Major foreign funds hold significant stakes in Mps, including BlackRock with nearly 5%, Vanguard with 3.1%, Norges Bank with 3%, and Amundi with 1.1%.
Among major Italian shareholders, the position of the Caltagirone group, which holds 13.5%, remains to be seen. The Italian Ministry of Economy and Finance has repeatedly stated it will not deposit its 4.9% stake for the meeting.
What this means for shareholders
Intesa Sanpaolo has positioned its offer as a clear alternative for Mps shareholders, with what it calls a "clear industrial rationale" and "proven execution capability." The bank said the operation would make Mps the hub of a "reference banking pole with significantly larger dimensions" rather than breaking up the bank.
For Mps shareholders, the choice now comes down to accepting a defined offer with a cash component or backing Lovaglio's complex plan with uncertain outcomes and interdependent transactions. The premium on offer has increased, but so has the pressure: approve Lovaglio's plan, and Intesa's offer disappears entirely.
