Tuscany's MPS adds cash sweetener to Mediobanca bid

(Sharecast News) - Monte dei Paschi di Siena sweetened its takeover offer for Mediobanca on Tuesday, by adding a €750m cash component to its original all-share bid, intensifying a contest that has gr gripped Italy's banking sector since January. The Tuscan lender said it would now offer 90 euro cents in cash per Mediobanca share in addition to 2.53 of its own shares for each share tendered.

Its revised offer valued Mediobanca at just under €17bn, and represented an 11.4% premium to the bank's closing price on 23 January, when the bid was first launched.

Monte dei Paschi's move came days before the 8 September deadline for acceptances and as it looked to gain 'de facto' control of the Milan-based lender.

Shareholder support stood at 28.16% as of 1 September, including backing from Delfin, the Del Vecchio family's holding company, and construction magnate Francesco Gaetano Caltagirone, who together own 28% of Mediobanca and are also among the largest investors in MPS itself.

The bank had waived its original two-thirds acceptance threshold, set in January, after lowering it to 35% in June when the European Central Bank confirmed there were no minimum requirements.

MPS said it was reaffirming its financial goals and described the higher offer as "further and concrete evidence of the industrial value of the transaction."

If successful, the deal would combine Monte dei Paschi's commercial banking network with Mediobanca's investment banking and wealth management operations, creating a group with over €200bn in assets.

It also marked a transformation for MPS under chief executive Luigi Lovaglio, after the Italian government sold most of its stake last year while retaining its position as the largest shareholder.

The bid was part of a broader wave of dealmaking across Italy's fragmented banking sector, with Rome pushing for the creation of a third major banking hub to challenge Intesa Sanpaolo and UniCredit.

Reporting by Josh White for Sharecast.com