Mps convenes extraordinary board meeting after Intesa's Opas relaunch

Monte dei Paschi di Siena has convened an extraordinary board of directors meeting for Monday afternoon, following the relaunch of Intesa Sanpaolo’s public tender and exchange offer and the emergence of a bloc of shareholders exceeding one third of Monte’s capital, which has expressed its intention to reject the alternative plan proposed by chief executive Luigi Lovaglio.

Intesa Sanpaolo’s relaunch consists of a 25-cent-per-share increase in the cash component of its offer. It is in response to this move that Mps convened, for Monday, October 12, the extraordinary board meeting.

The front of shareholders opposed to Lovaglio’s plan could widen further: if Francesco Gaetano Caltagirone were also to join the Del Vecchio family holding, the alignment critical of the chief executive would exceed 31% of the Siena-based bank’s capital.

The convening of the extraordinary board meeting marks an acceleration in the contest between Mps and Intesa Sanpaolo, which is being played out on two parallel levels: on one hand the direct dispute between the two banks over the terms of the offer, on the other the internal resilience of Monte’s governance, put to the test by a shareholder base increasingly divided over the strategy to pursue in the face of the rival’s relaunch.

Monday’s board will have to assess how to respond formally to Intesa Sanpaolo’s relaunch, in a context where the chief executive’s position appears weakened by the size reached by the critical front. The board’s decision will come little more than two weeks before the shareholders’ meeting that will call on shareholders to vote on the offer.

The central step, on which the final outcome of the affair will be determined, remains the shareholders’ meeting set for October 29. It will be in that forum that the front critical of the Lovaglio plan — currently estimated at over one third of the capital, with room to grow depending on Caltagirone’s possible adherence — will be able to translate its position into a formal vote on Intesa Sanpaolo’s Opas.