BPER's top investor Unipol ups Popolare Sondrio stake to 7%

MILAN (Reuters) - Italian financial group Unipol has raised its stake in Popolare di Sondrio to 7%, in a move that may ease a tie-up between the regional bank and bigger rival BPER Banca.

FILE PHOTO: The logo of Banca Popolare di Sondrio bank is pictured outside a company's branch, in Monza, Italy, February 5, 2020. REUTERS/Flavio Lo Scalzo/File Photo

Unipol is the top investor in BPER Banca with a stake of nearly 20% and has been the leading force behind BPER’s merger ambitions.

Unipol Chief Carlo Cimbri said in an interview in March that Popolare di Sondrio was “the most natural” tie-up option for BPER, which is Italy’s fifth-largest bank.

The two banks are co-investors in asset management Arca SGR. Popolare di Sondrio also has an insurance agreement with UnipolSAI, Italy’s No. 2 insurer, owned by Unipol.

As Italian banks head towards a new merger wave this year, helped also by tax incentives, Cimbri has been looking at a wider distribution network for UnipolSAI’s products.

“The transaction is part of UnipolSai’s strategy aimed at contributing to the development plans of the bank, industrial partner of the Unipol Group since 2010 in the non-life and life bancassurance sector,” Unipol said in a statement.

BPER had been discussing a merger with larger rival Banco BPM but talks recently hit a wall, several people close to the matter told Reuters.

Cimbri is now targeting smaller-sized Popolare di Sondrio because he wants BPER to play a leading role in a merger deal and retain a strong influence as a shareholder which has proven hard to achieve in a tie-up with Banco BPM, one person said.

Unipol said late on Tuesday UnipolSAI would buy an up to 6.6% stake in Popolare di Sondrio, paying a premium of between 2% and 4% on the stock’s closing price - for a maximum investment of 125 million euros ($153 million). Unipol already owns 2.9% of Popolare di Sondrio.

On Wednesday, UnipolSAI said it had bought a 4% stake at a price of 4.15 euro per share, paying a premium of 3.5% on Popolare di Sondrio stock’s closing price on Tuesday. Milan-based broker Equita SIM carried out the purchases on Unipol’s behalf.

Shares in Popolare di Sondrio were up 0.8% at 4.04 euros by 0945 GMT.

Popolare di Sondrio is Italy’s only large cooperative bank that has yet to comply with rules forcing such lenders to drop the cooperative status which effectively prevents takeovers.

Popolare di Sondrio had appealed against the changes but after the European Union’s top court last year said that the rules Italy introduced in 2015 were lawful, the country’s highest administrative court is expected to soon order Popolare di Sondrio to comply with the norm by Dec. 31.

($1 = 0.8170 euro)

Reporting by Valentina Za and Andrea Mandala in Milan; Editing Giulia Segreti and Matthew Lewis/Emelia Sithole-Matarise