UniCredit’s takeover target Banco BPM secures investor backing to sweeten Anima bid

MILAN: Banco BPM shareholders on Friday backed the Italian bank’s decision to pay more to buy fund manager Anima Holding, in a vote of confidence for CEO Giuseppe Castagna’s strategy to confront an unsolicited bid by UniCredit.

UniCredit in late November swooped on Banco BPM, which has long been a natural takeover target for the bigger peer given its roots in Italy’s wealthy Lombardy region, where UniCredit’s market share is considered too small.

UniCredit’s bid put at risk the buyout offer Banco BPM had launched two weeks earlier to take full control of Anima.

The deal will boost the fees BPM makes by selling Anima’s mutual funds through the bank’s branches, at a time when interest rates are falling, compressing lending profit.

Given UniCredit’s buyout offer, Banco BPM had to receive shareholder backing before raising its bid for Anima.

UniCredit, in turn, has reserved the right to drop its own offer for BPM if the Anima bid’s terms were to change.

UniCredit warns it could drop Banco BPM offer if Anima bid cost rises

The proposal got backing from shareholders equivalent to 97.6% of BPM’s capital present at the meeting. Attendance stood at 56.6% of the total.

The shareholders also gave the board the power to waive some of the conditions the bid is subject to, such as clinching the Anima deal before knowing if the European Central Bank grants it a favourable capital treatment known as ‘Danish Compromise’.

Banco BPM this month proposed paying 7 euros a share from 6.2 euros previously for the 77.6% of Anima it doesn’t already own.