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Discussion on UniCredit rescue of the collapse of Monte dei Paschi

The Italian government and UniCredit will suspend negotiations to acquire the troubled lender Monte dei Paskidisiena (MPS) after an attempt to reach an agreement on a costly recapitalization failure.

Those involved in the negotiations said Italy’s Finance Minister and UniCredit were unable to reach an agreement on the acquisition of Tuscan lenders. This decision will be officially announced in the coming days.

According to those involved in the negotiations, one of the major obstacles in the final round of the negotiations was the amount of capital the government needed to inject into the MPS.

“This operation was considered too expensive by the Italian government. The capital injection required by UniCredit would have been too difficult,” said an Italian official.

The Italian Treasury, which bailed out MPS in 2017, must sell its shares in the world’s oldest bank by December 31, under conditions set by the European Commission.

“It’s clear that the trading potential is now close to zero,” said another person involved in the negotiations.

The fate of MPS has sparked a dispute in a coalition government led by former European Central Bank governor Mario Draghi.

Earlier this week, the Treasury showed that it did not want to provide much more capital than its initial forecast of € 2 billion to € 2.5 billion.

The Milan-based UniCredit, first reported by Reuters and confirmed by those involved in the negotiations, costs up to € 7 billion, which is an infeasible option for the Italian government.

One negotiator said: There is no room for dialogue anymore. “

UniCredit plans to announce a new business strategy in the fourth quarter of this year, and the Treasury said the deal on MPS needs to be agreed by the end of October as long-term negotiations have postponed investor days. I told you.

Earlier this week, the FT reported that the Italian government was trying to push it back. Approaching the deadline Negotiations with UniCredit, which is scheduled to be acquired, have been a major obstacle to capital injection, and over the sale of Monte dei Paskidisiena.

UniCredit declined to comment and the Treasury did not respond immediately

Discussion on UniCredit rescue of the collapse of Monte dei Paschi

Source link Discussion on UniCredit rescue of the collapse of Monte dei Paschi

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