Investing.com -- Banco BPM SpA has proposed a merger of equals with Banca Monte dei Paschi di Siena SpA that would create Italy’s second-largest banking group, the Milan-based lender said on Sunday, after its board unanimously approved sending a letter to Monte Paschi expressing interest in opening talks on a negotiated combination. It is estimated that the deal will result in pretax synergies worth over €1.1 billion, including over €650 million in cost savings and over €450 million in revenue synergies, Banco BPM said, with execution risk limited because the two lenders have complementary geographical footprints and business operations.
No exchange ratio or financial terms were disclosed. The combined group would carry a market capitalisation exceeding €50 billion, a pro-forma CET1 ratio of approximately 15%, earnings per share growth of more than 10%, and value creation of at least €5.5 billion for shareholders. Banco BPM said the transaction would sit alongside Monte Paschi’s ongoing integration of Mediobanca, allowing for the coordinated development of the combined group’s product factories.
The deal would also broaden options related to Monte Paschi’s stake in Assicurazioni Generali SpA.Governance of the combined entity would be based on principles of balance and representation between the two institutions, with both brands, historic offices, and local roots preserved, Banco BPM said.
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