Mediobanca Fends Off Monte dei Paschi's Bold Takeover Bid

Mediobanca rejected a 13.3 billion-euro takeover attempt by Monte dei Paschi, citing a lack of industrial logic and potential shareholder value destruction. The bid aimed to create Italy's third-largest bank with significant synergies. Shareholder discussions are expected next month under governmental re-privatization efforts.

Mediobanca has turned down a surprise 13.3 billion-euro acquisition proposal from Monte dei Paschi di Siena, labeling the offer as lacking industrial and financial logic. The attempted takeover by Italy's oldest banking institution aims to realign the sector by creating significant synergies and enhanced profitability.

Monte dei Paschi, after recent governmental moves to re-privatize it, argued that the merger would generate 700 million euros annually in pre-tax synergies. However, Mediobanca asserted that the proposal undermines its identity in high-value business segments and could erode shareholder value at both banks.

Italian Premier Giorgia Meloni noted that if successful, the merger would establish Italy's third-largest bank, playing a vital role in safeguarding Italians' savings. Key shareholders are set to discuss the proposition in an upcoming meeting focused on the 2024 financial outlook.

(With inputs from agencies.)