Boards approve European bank deal

Unicredit’s planned acquisition of Capitalia, a deal valued at $29.5 billion that would create Europe’s second-largest bank, was approved Sunday by the boards of both companies.

“This extraordinary, important group is about to take off,” Capitalia Chairman Cesare Geronzi said at a news conference shortly after the boards met.

He said the dealings leading up to the acquisition were characterized by “great transparency.”

“This is a friendly deal,” Geronzi said. “This was the only deal possible.”

Unicredit Chief Executive Alessandro Profumo said the acquisition would reinforce both groups in Italy and abroad, mentioning Austria, Germany and Central Europe in particular. “This makes strong business sense,” he said.

Unicredit’s board met in Milan while Capitalia’s board gave its approval at a meeting in Rome, the banks said in a joint statement. Unicredit will exchange 1.12 of its shares for each share of Capitalia, the banks said.

The deal would create a pool of 40 million customers and a presence in 17 countries. Together there would be about 9,000 bank branches, a little more than half of them in Italy.

The market value of the combined bank would exceed $135 billion. It would be second in Europe only to HSBC Holdings and would be the fifth-largest bank in the world.