The deal, worth €21.8 billion, keeps Capitalia, Italy's third largest bank, out of the hands of prospective foreign bidders, thereby strengthening the position of Italian lenders in the 13 nations using the euro.
The number of mergers in the banking sector has rocketed as European banks try to improve their positions in the EU. UniCredit’s rapid growth has itself been built on mergers and acquisitions that have allowed it to expand into Germany, Austria and Russia, giving the company a market value of €78 billion.
The UniCredit-Capitalia deal, which was announced on 20 May 2007, takes place at a time when the banking landscape across Europe is set to change, as the largest takeover battle in the history of the banking sector – pitting Barclays of Britain against a Royal Bank of Scotland-led consortium, including Spanish Satander and Belgo-Dutch Fortis for the takeover of the largest Dutch bank ABN AMRO – comes to a head (EurActiv 04/05/07).
The EU recently shook up its rules on mergers and acquisitions in the banking sector, in order to make them more transparent and to fend-off protectionist interventions by national authorities (EurActiv 14/03/07).
But Italy remains keen to fend off competition from foreign banks, such as French banks Crédit Agricole and BNP Paribas and the Dutch ABN Amro, which have been circling the Italian banking market because it is one of the eurozone’s most lucrative, with the loan market is expanding at an annual rate of 11%.
Capitalia Chairman Cesare Geronzi said: “I wanted an Italian tie-up,” adding that UniCredit’s takeover will bring “a large portion of the central and southern banking system under protection” from foreign control.
