Italy's second largest bank UniCredit was preparing to launch a takeover offer for the number three lender Banco BPM in early 2022, before Russia's invasion of Ukraine forced CEO Andrea Orcel to focus on its large Russia exposure.
Orcel had also looked to move on Banco BPM soon after becoming UniCredit CEO two years ago, sources previously said, but then entered talks with the government over a possible Monte dei Paschi acquisition that eventually fell through.
The comments by Fabrizio Palenzona, a former deputy chairman of UniCredit who on Tuesday became chairman of banking foundation Fondazione CRT, refocus attention on a tie-up which is widely seen as the most obvious domestic deal for UniCredit.
Fondazione CRT holds 1.9% of UniCredit and 1.8% of Banco BPM. Speculation of a deal has resurfaced recently because UniCredit's rising share price has brought the exchange ratios of a potential all-share deal back to the levels of a year ago.
Orcel has used large scale share buybacks to lift UniCredit's stock price.
Palenzona told la Repubblica newspaper that the then UniCredit CEO Alessandro Profumo had sent him to propose a friendly takeover offer to Banco BPM two decades ago.
"Profumo's idea was to strengthen UniCredit in Lombardy where it faces a gap compared to rivals. Twenty years later that gap is still there so the strategic value of the deal remains".
Born from the merger of Milan-based BPM with Verona based Banco Popolare, Banco BPM controls 12% of the banking market in Lombardy, twice UniCredit's market share.
Pressure on UniCredit mounted further after Intesa Sanpaolo took over UBI, another northern bank, in 2020.
(Reporting by Valentina Za and Cristina Carlevaro, editing by Federico Maccioni and Alexander Smith)
By Valentina Za
