Monte dei Paschi di Siena (MPS) and Mediobanca have taken concrete steps to move forward with a full merger, as confirmed in the joint release by the banks.
Under the proposed terms, MPS plans to issue up to 1.6 billion euros ($1.9bn) in new shares, reported Reuters.
Mediobanca shareholders would receive 2.45 MPS shares for each Mediobanca share offered.
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The proposal is intended to allow MPS to acquire the remaining 14% of Mediobanca it does not currently own, with the goal of taking the company private.
The merger is part of a wider restructuring plan.
This includes assigning corporate and investment banking, along with private banking services for high-end clients, to a wholly owned and unlisted BMPS subsidiary that will operate under the name “Mediobanca S.p.A.”
The reorganisation also brings together the financial advisor networks, as well as retail and affluent wealth management operations of Mediobanca Premier and Banca Widiba.
The latter will adopt a revised corporate name reflecting the Mediobanca brand.
If both the merger and reorganisation are completed, Mediobanca shareholders may see benefits such as increased liquidity from BMPS shares, participation in BMPS’s announced dividend policy, potential access to further shareholder distributions, and involvement in BMPS group’s future plans.
These developments are consistent with the combined group strategy presented by outgoing MPS chief executive Luigi Lovaglio in February.
The search for a new CEO continues, with three candidates proposed by MPS for an April shareholder vote.
No alternative candidates have been put forward so far.
MPS announced a 2030 adjusted net profit target of €3.7bn ($4.4bn) and expects to finalise its merger with Mediobanca by the end of the year.
The bank also said it plans to deliver all anticipated merger benefits by 2028.
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