Monte dei Paschi has bid for two Italian banks at once, and the group it would build is its answer to the bank that bid for Monte dei Paschi

Fifty point one percent.

That is the slice of the combined bank that today's MPS shareholders would hold if both offers were taken up in full and the Mediobanca merger completes, against about 37.2 percent for Banco BPM's holders and about 12.7 percent for Banca Generali's. The board of Banca Monte dei Paschi di Siena met on 20 August under the chairmanship of Cesare Bisoni and approved, by a majority of its members, two simultaneous voluntary public exchange offers under Articles 102 and 106(4) of Italy's Consolidated Financial Act. Both were announced the following morning, in Siena, through the two communications the statute requires.

The consideration is newly issued MPS shares and nothing else. Banco BPM holders would receive 1.567 of them for each share they own, which the release puts at 16.729 euro a share and at no premium to the official price of 19 August. Banca Generali holders would receive 6.958, which it puts at 74.284 euro and a premium of 10.0 percent on the same basis. Both ratios were struck after allowing for a separate payout to MPS shareholders. Together the two come to about 25.31bn euro and 8.72bn euro.

Why there has to be a vote

Because MPS is itself a target.

The release records that its shareholders' meeting on 29 October is convened "also for the purposes of and pursuant to Article 104 of the Consolidated Financial Act, in light of the voluntary public exchange and cash offer on all MPS shares announced by Intesa Sanpaolo S.p.A. on 8 June 2026". Article 104 is the provision that requires a company under offer to get its own shareholders' authorisation before taking action that could frustrate it. So the offers, the payout, the preparatory steps and the two capital increase mandates that would fund the share issue all go to the same meeting, and MPS shareholders decide in one sitting whether their bank spends the autumn buying or being bought.

The payout

Four billion euro gross, reserved to MPS shareholders recorded before the offers settle, and no part of it reaches anyone who arrives with an accepted Banco BPM or Banca Generali share.

It works out at 1.208 euro a share, of which 0.302 euro is cash and 0.906 euro is paid in kind in shares of Assicurazioni Generali, currently held by MPS through Mediobanca, amounting to roughly 4.5 percent of Generali's share capital at the current market price. It comes out of available reserves after a capital reduction, settles before the offers pay, and is conditional on MPS declaring at least one of the two offers effective. On top of it MPS says it expects cumulative distributions above 15bn euro across 2026 to 2030 at a full pay-out ratio.

The bank it would make, on the offeror's own numbers

Everything in this paragraph is an estimate published by the party making the bid, and none of it is a reported result. MPS puts the combined balance sheet at about 466bn euro of total assets on 2025 figures, with 245bn euro of customer loans, 315bn euro of direct funding and 810bn euro of total financial assets, which it says would make it Italy's third largest banking group by assets. It estimates run-rate pre-tax synergies of about 2.6bn euro a year, of which 0.8bn euro comes from the Mediobanca integration already under way, against one-off integration costs of about 2.5bn euro before tax spread over 2027 to 2029. Cost to income would fall to about 36 percent from 46 percent standalone, return on average tangible equity would rise from about 13 percent in 2025 to above 19 percent in 2029, and 2028 earnings a share would be about 11 percent higher. Each of those assumes the synergies arrive in full.

What has to happen

Each offer needs three things: authorisation from the MPS meeting under Article 104, acceptances covering 50 percent of the target's share capital plus one share, and the regulatory clearances. The offer documents follow only after CONSOB approves them, and MPS expects completion by mid February 2027.

One further mechanic is worth naming, because it is unusual for a bidder to volunteer it. Assicurazioni Generali is a related party of MPS and is also a Banca Generali shareholder, so the board applied the safeguards for related party transactions of greater significance even though it was not obliged to, and the related party committee gave a favourable opinion by a majority. An information document on that will follow.

The release carries a legend on every page. The offers will not be promoted or disseminated in the United States, Australia, Canada or Japan, nor through those countries' communication channels or financial intermediaries.