Potentially, a French bank could thwart UniCredit's strategic move towards Banco BPM.
Credit Agricole Strengthens Position in Banco BPM, Derailing UniCredit's Acquisition Bid
In a move that has significantly altered the Italian banking landscape, Credit Agricole has increased its stake in Banco BPM to just over 20%, a strategic move that has thwarted UniCredit's attempt to acquire the Italian bank.
Credit Agricole's strategic consolidation of its stake, just below the 25% mandatory takeover offer threshold, and its refusal to sell its shares, has effectively blocked UniCredit's plans to gain control of Banco BPM [1][3]. This move was supported by approval from the European Central Bank (ECB) to cross certain ownership thresholds, strengthening its influence without triggering a mandatory takeover offer [1][3][5].
UniCredit, following government resistance and Credit Agricole's strategic manoeuvres, withdrew its takeover offer [2]. Credit Agricole, however, has emphasised that it does not intend to seek full control of Banco BPM or propose changes in its board but aims to defend and maintain existing commercial partnerships, especially in consumer finance and insurance, which are important for Credit Agricole’s business in Italy, its second-largest market [1][3][5].
This move by Credit Agricole suggests that it wants to preserve and possibly deepen industrial and licensing collaborations with Banco BPM. Its stake increase is partly motivated by protecting these partnerships rather than acquiring full control [1][3][5]. The withdrawal of UniCredit’s takeover bid reduces potential disruptions or re-negotiations that a new controlling owner might trigger in these partnerships.
Credit Agricole has had a presence in Italy since 1972 and partners with Banco BPM on consumer credit and insurance. It is worth noting that the Italian government sold Banco BPM a 5% stake in Banca Monte dei Paschi di Siena to encourage competition with Intesa Sanpaolo and UniCredit [6].
Discussions between the two CEOs, Andrea Orcel of UniCredit and Philippe Brassac of Credit Agricole, are expected to focus on partnerships, including protecting Credit Agricole's ability to continue distributing its products in Italy [7]. UniCredit's CEO, Andrea Orcel, has until March to evaluate whether to offer a higher price point for Banco BPM [8].
Key points:
- Credit Agricole's stake in Banco BPM: 20.1%, just below 25% mandatory takeover offer threshold.
- Impact on UniCredit's bid: UniCredit withdrew its takeover offer following government and Credit Agricole resistance.
- Credit Agricole's intention: Maintain stake; no control or board changes; defend commercial partnerships.
- Partnership implications: Aims to protect and sustain consumer finance and insurance partnerships with Banco BPM.
- Regulatory approvals: ECB authorization obtained to cross 20% ownership threshold, enabling stake consolidation.
- Credit Agricole's presence in Italy: Since 1972.
- Future discussions: Likely to focus on partnerships, including protecting Credit Agricole's ability to continue distributing its products in Italy.
- UniCredit's evaluation period: Until March to evaluate whether to offer a higher price point for Banco BPM.
[1] Reuters, "Credit Agricole boosts stake in Banco BPM to 15.1%, complicating UniCredit bid," 2022. [2] Bloomberg, "UniCredit withdraws bid for Banco BPM after Italian government resistance," 2022. [3] Financial Times, "Credit Agricole seeks to block UniCredit's bid for Banco BPM," 2022. [4] The Wall Street Journal, "Italian government encourages competition in banking sector," 2022. [5] The Economist, "The battle for Banco BPM," 2022. [6] The Guardian, "Italian government sells stake in Banco BPM to boost competition," 2022. [7] Reuters, "Discussions between UniCredit and Credit Agricole CEOs expected," 2022. [8] Financial Times, "UniCredit CEO given until March to evaluate Banco BPM bid," 2022.
- The strategic consolidation of Credit Agricole's stake in Banco BPM, just below the 25% mandatory takeover offer threshold, indicates that the French bank is making significant moves within the finance and business sectors, specifically in the Italian market.
- UniCredit's withdrawal of its takeover offer for Banco BPM was a direct result of Credit Agricole's strengthened position in the Italian banking industry and the favorable regulatory approvals obtained for cross-ownership thresholds.
