Job Loss Concerns as Banco BPM Faces UniCredit’s Takeover Proposal
Giuseppe Castagna, CEO of Banco BPM, has expressed serious concerns that a potential takeover by UniCredit could result in the loss of up to 6,000 jobs. In a letter to Banco BPM employees, Castagna highlighted the significant risks posed by the merger, particularly regarding the projected cost synergies which account for more than a third of Banco BPM’s cost base. He emphasized that these synergies, if realized, could lead to widespread job cuts, making the “employment and social impacts” a critical issue.
Castagna also reiterated that Banco BPM remains focused on growing independently, underscoring that the bank’s current and future value is best preserved by avoiding a merger that does not align with its strategic goals or long-term vision.
Banco BPM Rejects Unsolicited UniCredit Bid
Banco BPM has firmly rejected UniCredit’s unsolicited takeover offer, which proposed exchanging 0.175 UniCredit shares for each Banco BPM share, valuing Banco BPM at €6.657 per share. The bank issued a statement stating that the offer “does not reflect the true profitability or growth potential” of Banco BPM.
During a board meeting, Banco BPM officials expressed concerns that the takeover bid would undermine the bank’s strategic direction and harm its ability to serve small and medium-sized enterprises (SMEs), a cornerstone of Banco BPM’s operations. They stressed that the bid failed to recognize the full potential of Banco BPM’s future growth and the value it brings to its shareholders.
Strategic Impact on Banco BPM’s Expansion Plans
Beyond concerns over job cuts, a potential merger with UniCredit would complicate Banco BPM’s own expansion strategy. The bank has been in the process of acquiring Anima Holding, a €1.6 billion asset management deal, aimed at diversifying its revenue sources amid low interest rates. However, if the takeover goes ahead, this strategic move could be jeopardized, as the combined entity would likely have a different approach to expansion.
Additionally, Banco BPM’s rejection of UniCredit’s bid comes amid growing concerns over UniCredit’s increasing stake in Germany’s Commerzbank, a move that has faced strong opposition from the German government. This highlights the broader regional implications of a potential merger, with fears that it could disrupt the competitive balance within the European banking sector.