Concerns Over Job Cuts in Potential UniCredit Merger
Giuseppe Castagna, the CEO of Banco BPM, has warned that a takeover by UniCredit could result in the loss of up to 6,000 jobs. In a letter to employees, Castagna highlighted the significant concerns surrounding the potential impact of the merger on employment, stressing that UniCredit’s projected cost synergies, which account for over a third of Banco BPM’s cost base, could lead to job reductions. He raised alarms about the “social and employment consequences” of such a move, urging that Banco BPM is on the right path to grow independently.
Castagna emphasized that the bank remains committed to supporting its employees and communities and expressed confidence in Banco BPM’s long-term value and growth potential without being absorbed by another bank.
Banco BPM Rejects Unsolicited UniCredit Offer
Banco BPM has formally rejected UniCredit’s unsolicited takeover bid, which offered 0.175 UniCredit shares for each Banco BPM share, valuing Banco BPM at €6.657 per share. The offer was dismissed by Banco BPM, which stated that it “does not reflect the bank’s profitability or potential for future growth.”
Following a board meeting, Banco BPM officials raised concerns about the long-term implications of the bid, including the impact on the bank’s employees and its ability to continue serving its clients, particularly small and medium-sized enterprises (SMEs). The bank also stressed that the offer did not align with its strategy for growth and diversification.
Impact on Banco BPM’s Strategic Direction
The potential merger with UniCredit could also jeopardize Banco BPM’s ongoing strategic initiatives, particularly its acquisition of Anima Holding, a €1.6 billion asset management deal. Banco BPM sees this acquisition as a crucial step in diversifying its revenue streams, especially as interest rates remain low. If the merger proceeds, however, it would likely force the bank to alter its strategy and possibly abandon plans to expand in asset management.
Moreover, the deal could complicate UniCredit’s position in Europe, especially as the bank continues to increase its stake in Germany’s Commerzbank, a move that has already drawn opposition from the German government. The potential merger raises wider concerns about the competitive dynamics within Europe’s banking sector.
