2 Italian Banks to Combine in $37.8-Billion Transaction
Banca Intesa agreed to buy smaller rival Sanpaolo IMI for $37.8 billion to the bank with become the bank with the most customers in Italy.
Corrado Passera, chief executive of Milan-based Intesa, would oversee the combined company, which would have about 13 million customers in Italy, double those of competitor UniCredit.
After the deal, unveiled Saturday, the combined Intesa-Sanpaolo would have a market value of about $83 billion, ranking it among Europe’s top 10 banks.
“This is an excellent deal,” said Riccardo Dubbioso, who helps manage $2.6 billion in assets, including Sanpaolo shares, at BNP Paribas Private Banking in Milan. “It creates a national champion and puts two of Italy’s most important lenders out of reach of foreign banks.”
Passera, 51, had been under pressure to make a purchase since UniCredit leapfrogged Intesa as the No. 1 Italian bank by assets after buying Germany’s HVB Group for $24 billion in June 2005.
Intesa is offering 3.115 of its shares for each share of Turin-based Sanpaolo .
The bid’s value is 2% less than Sanpaolo’s closing price Friday. Shares of Sanpaolo have surged 9.8%, and Intesa is up 8.5%, since the banks said Thursday that they were considering a merger.
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