The ECB authorised Intesa to take control of MPS on Tuesday. Intesa can drop its offer if MPS holders back either of their board's two rival bids on Thursday.
MPS shares trade 6 cents above what Intesa's offer is worth, so the market prices a clean vote and no higher bid. At Wednesday's prices the offer is worth about €33bn, or €10.82 per MPS share, and MPS trades at €10.88, 0.6% above it.
A desk long MPS and short 1.6 Intesa shares per MPS share loses about €0.06 if the deal completes on current terms. It wins only on a higher bid. That makes Thursday's vote the one event left to price.
The deciding vote is in Siena after the ECB’s approval in Frankfurt. MPS shareholders meet at 10:00 on 29 October to vote on the board's rival bids for Banco BPM and Banca Generali. Intesa's offer depends on them rejecting both.
Approval of either bid would give Intesa the right to drop its offer, Reuters reported on 3 October. Intesa does not intend to waive that right and will claim for their non-fulfilment.
The ECB's authorisation of 27 October is not completion. Its reporting requirements are not conditions of the offer.
What the offer is worth
Each MPS share is offered 1.6 new Intesa shares plus €1.25 in cash. Intesa lifted the cash from €1.00 on 3 October, worth about €800m more in total. It pays the cash only if MPS holders reject their board's counter plan.
The €10.82 comes from Wednesday intraday trading, with Intesa at €5.98 and MPS at €10.88. The premium is small because investors expect the vote to go Intesa's way.
At the Intesa price of 5.98 euros on 28 October the offer of 1.6 Intesa shares plus 1.25 euros in cash is worth 10.82 euros per MPS share, and the cash is paid only if MPS holders reject their board's counter plan. MPS traded at 10.88 euros, a premium of 0.6 percent, smaller than the intraday falls in Intesa (0.65 percent) and MPS (0.68 percent).
View data
| Measure | Percent |
|---|---|
| MPS price premium to offer value (6 cents) | 0.6 |
| Intesa intraday move | 0.65 |
| MPS intraday move | 0.68 |
Intesa shares make up 88% of that value, €9.57 of the €10.82. Every 10 cent move in Intesa shifts the offer by 16 cents. A holder who tenders keeps the paper and carries Intesa's price on 88% of the value.
The cash bill on the 3,037,594,735 shares subject to the offer is €3.80bn. Intesa finished a €2.3bn buyback in October, so the cash is covered.
MPS holders would receive about 4.86bn new shares. That is 21.6% of the enlarged bank, on about 17.7bn shares in issue at the 10 September meeting.
If the Mediobanca merger completes before the acceptance period closes, up to 272m more MPS shares join the offer. The cash bill then rises to €4.14bn and MPS holders would own 23.0%. Intesa's shareholders on 10 September authorised up to 5.7bn new shares, with 96.96% of shares present in favour. That leaves room for the merger shares.
Intesa’s capital position
Intesa can afford the deal's capital demands. The 10.01% figure in the ECB's capital letter is Intesa's own overall CET1 requirement (core equity capital as a share of risk-weighted assets) from 1 January 2027. It is not a charge on the deal.
The 10.01% is Pillar 1 (4.5%) plus Pillar 2 (0.98%) plus four buffers: 2.5%, 1.25%, 0.35% and 0.43%.
Intesa's CET1 ratio was 13.1% at 30 June, after deducting €5.3bn accrued for distribution and the €2.3bn buyback. That sits 3.09 points above the requirement, or 3.79 points pro forma for deferred tax assets. These are Intesa's standalone figures.
How shareholders are lining up
The vote leans Intesa's way. Delfin holds 17.6% of MPS. It signed an undertaking on 4 October to tender its shares and to vote "in a manner consistent with the conditions of the Offer". Delfin also cannot buy MPS shares until six months after the last payment date. At the offer price that stake is worth €5.8bn, of which €668m is cash.
Reuters reported on 12 October that investors holding about a third of the bank's capital will reject the defence plan and accept Intesa's bid. That blocks the two thirds majority the board needs. Below 100% turnout, a third of capital is more than a third of the votes cast.
Repubblica reports that the Treasury, with 4.86%, and Banco BPM, with 3.74%, will not attend the meeting. ISS and Glass Lewis told holders to reject the twin bids and the special dividend. They back the Mediobanca merger.
Norges Bank Investment Management, which held 2.98% at the end of 2025, will vote against both bids.
A higher bid looks unlikely. The 0.6% premium is 6 cents on €10.82, smaller than Wednesday's intraday fall in either stock (Intesa 0.65%, MPS 0.68%). Rome has said it will remain neutral on the wave of bank mergers. Economy minister Giorgetti has said Italian banks should be predators rather than prey.
The only rival structure is the pair of bids, and a third of the capital has said it will block them.
The approvals still to come
Regulators come next. Consob, the market regulator, should approve the offer document early next month, Reuters reported. Intesa can then open the tender without waiting for antitrust, whose decision is expected in the second half of November.
Antitrust approval requires Intesa to give up assets. It has agreed to sell half of MPS's branches to Unipol, which will merge them with BPER's. Reuters reported, citing sources, that it may have to sell a few dozen more. UniCredit is interested in assets coming up for sale.
Generali is the harder remedy. Buying MPS, which owns Mediobanca, would give Intesa an indirect 13.4% of the insurer. The antitrust head, Saverio Valentino, said the authority may need behavioural remedies so the stake stays "a purely financial investment".
Intesa needs board representation to book the stake by equity consolidation. Carlo Messina said on 27 October that Intesa wants to keep Generali independent with UniCredit and the Del Vecchio, Caltagirone and Benetton families.
With Delfin bound to Intesa's conditions, the defence plan should fail on 29 October. MPS shareholders need two thirds to approve either bid. Consob's approval is due in early November and the antitrust ruling in the second half of the month.
Intesa's board meets on 3 November to approve the 30 September interim statement and decide an interim dividend, payable 25 November subject to the board. The vote will be known by then.