Crédit Agricole has proposed to Banco BPM that the two engage in discussions on a merger between Banco BPM and Crédit Agricole Italia, a combination the French lender says would create a new leading Italian bank built around Banco BPM and still listed in Milan. The friendly proposal, submitted to the evaluation of Banco BPM’s board of directors, is presented as a natural extension of the long-term partnership between the two groups.
For Banco BPM shareholders, the proposal provides for an exchange ratio that reflects a 20 percent premium, in addition to the payment of an extraordinary dividend of €1 billion to Banco BPM’s current shareholders. Crédit Agricole estimates synergies of €800 million a year and says the transaction would lift Banco BPM’s earnings per share by an estimated 24 percent in 2027. Through its contributions, Crédit Agricole would increase from its current 29.6 percent stake in Banco BPM to approximately 45 percent of the combined entity.
The proposed transaction would be conditional on approval by the extraordinary general meeting of Banco BPM with the majority required for the whitewash procedure, which would exempt Crédit Agricole from the obligation to launch a mandatory tender offer, and on the customary approvals for this type of transaction, including authorisations by the European Central Bank and under Italy’s golden power regime. Crédit Agricole says the transaction could be completed in the second half of 2027.
Nothing in the proposal binds Banco BPM, whose board has yet to respond, and the legal structure of the transaction has still to be defined between the parties. Reporting on the proposal says the combined group would be Italy’s third-largest bank and would be led by Banco BPM’s chief executive Giuseppe Castagna.