Monte dei Paschi di Siena has launched separate all-share offers valued at approximately €34 billion, or $40 billion, for Banco BPM and Banca Generali as the Italian lender seeks to remain independent and fend off a €36 billion takeover bid from Intesa Sanpaolo, according to Reuters.
MPS CEO Luigi Lovaglio is pursuing the two acquisitions as an alternative to Intesa’s cash-and-share proposal, which would ultimately break up substantial portions of MPS.
The proposed transactions would create Italy’s third-largest banking group and, according to Lovaglio, produce a combined institution ranking among Europe’s 10 largest banks.
MPS is offering 1.567 newly issued shares for each Banco BPM share, valuing Banco BPM at approximately €25.3 billion.
The bank is separately offering 6.958 newly issued shares for each Banca Generali share, valuing the wealth management company at approximately €8.7 billion.
The Banco BPM offer implies a value of €16.729 per share and does not represent a premium to the target’s closing price immediately before the proposal.
The Banca Generali offer implies €74.284 per share, representing approximately a 10% premium.
Together, the two transactions are expected to generate approximately €2.6 billion of annual pre-tax cost and revenue benefits, according to MPS.
The bank is targeting completion of the transactions by mid-February 2027.
MPS is also proposing an extraordinary €4 billion distribution to its shareholders.
That distribution would consist of €1 billion in cash and the remainder in shares of Italian insurer Generali currently held indirectly by MPS through Mediobanca.
The Generali shares being distributed would represent approximately 4.5% of the insurer. MPS currently controls an indirect 13.3% interest in Generali through Mediobanca, which MPS acquired in 2025.
The shareholder payout also serves as a counter to Intesa’s offer, which includes approximately €3 billion of cash for MPS investors.
MPS had previously explored a combination with Banco BPM as a potential defensive strategy against Intesa, but those discussions ended after Banco BPM’s largest shareholder, Crédit Agricole, opposed the plan.
The new approach effectively attempts to transform MPS from a takeover target into an acquirer of two major Italian financial institutions simultaneously.
The transactions would also advance a long-standing policy objective in Italy of developing a third major domestic banking group capable of competing with Intesa Sanpaolo and UniCredit.
However, the strategy will require substantial shareholder support.
Under Italian takeover rules, at least two-thirds of MPS shareholders must approve the proposed transactions at a vote scheduled for October 29.
Major shareholders include Delfin, the investment vehicle associated with the Del Vecchio family, and businessman Francesco Gaetano Caltagirone.
The proposal follows a dramatic transformation for MPS, which required an Italian government bailout in 2017 before being reprivatized between 2023 and 2024.
Under Intesa’s competing plan, Mediobanca would remain within the combined Intesa organization while approximately half of MPS branches, the Siena headquarters and the MPS brand would be transferred to BPER Banca.
Lovaglio has argued that such a breakup would destroy value and is instead seeking to preserve MPS as an independent banking platform through the Banco BPM and Banca Generali acquisitions.
