UniCredit Speeds Up Vote on Banco BPM Bid, Boosts Share Issuance

UniCredit, Italy's largest bank by assets, has moved up the date for a shareholder vote on its takeover bid for smaller rival Banco BPM, aiming to secure approval for issuing more shares to finance the acquisition. The bank announced on Thursday that the vote, previously scheduled for April 10, will now take place on March 27. Additionally, UniCredit has increased the maximum number of new shares it can issue to 278 million, up from the previous 266 million.



The acceleration of the vote and the increase in share issuance come as UniCredit seeks to strengthen its position in one of its core markets and enhance long-term value creation for stakeholders of both banks. The combined business is expected to deliver accelerated quality, sustainable growth through a reinforced revenue line, strengthened operational and capital excellence, leading to greater profitability. Moreover, the acquisition is anticipated to deliver enhanced shareholder returns following integration and the realization of synergies.

UniCredit's bid for Banco BPM, launched in November 2024, is an all-share offer valued at up to 13.29 billion euros based on Thursday's closing price. The increased number of shares UniCredit can issue will help finance the acquisition without overburdening its balance sheet or compromising its financial stability. By issuing new shares, UniCredit can raise the necessary funds to acquire Banco BPM while maintaining its capital ratios and avoiding excessive debt accumulation.

However, the issuance of new shares may lead to a dilution of existing shareholders' stakes, as the total number of outstanding shares increases. This dilution can reduce the proportion of ownership that each existing shareholder holds, potentially impacting their voting power and returns on investment. Nevertheless, UniCredit believes that the strategic advantages and synergies resulting from the acquisition of Banco BPM will outweigh the dilution effects, ultimately benefiting both UniCredit and Banco BPM shareholders in the long run.

In conclusion, UniCredit's decision to speed up the shareholder vote on its takeover bid for Banco BPM and increase the number of shares it can issue demonstrates the bank's commitment to pursuing strategic growth opportunities. By acquiring Banco BPM, UniCredit aims to strengthen its position in a core market, enhance long-term value creation, and deliver enhanced shareholder returns. Although the issuance of new shares may lead to a dilution of existing shareholders' stakes, the strategic advantages and synergies resulting from the acquisition are expected to outweigh these effects, ultimately benefiting both UniCredit and Banco BPM shareholders.