July 24, 2020 / 12:12 PM / 12 days ago

Italian bank Intesa expects late surge in UBI bid take-up - sources

MILAN (Reuters) - Italy’s second-biggest bank Intesa Sanpaolo (ISP.MI) expects investor take-up to soar in the last few days of its takeover bid for rival UBI Banca (UBI.MI), two sources close to the matter said on Friday, adding that acceptance could top 80%.

FILE PHOTO: The headquarter of UBI bank is seen in Brescia, Italy, March 9, 2016. REUTERS/Alessandro Bianchi/File Photo

The bid ends on July 28 and requires acceptance of 50% plus one share, though Intesa is targeting 66.67% take-up to guarantee control of extraordinary shareholder resolutions and to be able to subsume UBI within Intesa.

As of Thursday investors had tendered shares representing 26.4% of UBI’s capital, which the sources said was three times the level recent takeover bids in Italy had achieved with three trading sessions left.

The sources said that UBI’s retail clients accounted for about half of the 26.4% of shares tendered so far.

A stake of 10% could be traced back to two local charitable banking foundations based in the cities of Cuneo and Pavia.

The foundations announced last week that they would take up the offer after Intesa raised the bid by almost a fifth, adding 0.57 euros in cash for each UBI share tendered in addition to 1.7 new Intesa shares.

UBI on Thursday rejected the improved bid, saying it was still too low.

Intesa, which had previously ruled out the possibility of a higher bid, is spending up to 652 million euros (594 million pounds) to offer a 40% premium on UBI’s closing price when the offer was announced in mid-February, up from the initial 24%.

The sources said that most institutional investors had already given instructions to tender their shares but banks acting as their agents would wait until Monday to execute the orders.

They said that the final take-up could be as high as 85% in a best-case scenario.

The sources said that holdout investors would not be offered the same premium were Intesa to launch another bid on the residual UBI shares before it is merged into Intesa.

Reporting by Valentina Za; Editing by David Goodman

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