Alberto Nail, CEO of Mediobanca, has expressed very clearly his bank's position regarding theOps launched by Mps: “The public exchange offer launched by Monte dei Paschi It's not good for us, nor for our shareholders.".
In his speech at European Financials Conference di Morgan Stanley , Nagel explained why his bank views the operation with concern. “We have come to the conclusion that the operation is likely to lead to significant dissynergies, concentrated in the private and in 'investment banking, where obstacles will materialize on the revenue front,” he added. These dissynergies, he explained, would be “high enough to cannot be compensated by cost cutting“. A fact that raises more than a few doubts about the economic convenience for Piazzetta Cuccia, especially considering that the cost synergies expected by MPS are “achievable for less than a third”.
Dilution of earnings per share and dividend: "Dangerous operation for MPS"
Another aspect that worries Nagel concerns the dilution of earnings per share (Eps) and of the dividend per share (Dps) of Ps, following the takeover bid: “We believe that this operation is capable of generating a double-digit dilution in terms of Eps (Earnings per Share, i.e. profit per share) and Dps (ratio between distributed profits and the number of shares) of Montepaschi and therefore it is a negative operation neither for us nor for the shareholders of Mps”, declared the CEO of Mediobanca. Another alarm bell for Nagel, who considers the operation as a threat to the economic and financial stability of both banks.
Nagel reassures: “Decisions based on economic convenience”
On the political side, Nagel made it clear that the decisions of Mediobanca shareholders will not follow the political current, but they will be dictated by economic considerations. “The majority of our capital is in the hands of institutional investors and some private investors who will make their decisions based on convenience, not politics,” he explained, adding that for investors the “key factor” will be “choosing which stock to invest in, which risks to take.”
Nagel: “Customers are happy to continue working with us”
But that's not all: Nagel also talked about the feedback received from the stakeholder of Mediobanca, underlining the bank's solidity: "The reaction has been that clients and bankers are happy to continue working with us if we remain focused on what we do, on our model." He also added: "The response has been very good in confirming what we are doing and showing that even in difficult times we can continue to meet or exceed targets." Mediobanca, therefore, is "committed to showing us and clients that we continue to do better than forecast and remain true to our trajectory."
Banking Consolidation in Italy: Opportunities and Risks According to Nagel
Nagel then shifted his attention to the topic of consolidation banking, a hot topic in Italy. “In Italy, basically, banking consolidation makes sense, also to allow banks to invest more in digital and cyber,” he said, adding that this process is particularly useful for commercial banks. However, he warned of the risks associated with consolidation in the investment banking sector, where more attention is needed. “For the investment banks must have more attention e to consideration the risks to create fractures,” he said. For the CEO of Piazzetta Cuccia, therefore, while internal consolidation is a necessity, great care must be taken when crossing the boundaries of individual banking groups.
Despite these considerations, Nagel did not close the door to a future broader consolidation, stressing that Mediobanca still needs "internal consolidation and then also operations that cross borders", a clear signal that the bank is ready to face M&A operations aim at growth and the diversification, while maintaining a cautious and strategic approach.
Nagel: Mediobanca ready to exploit Generali stake for strategic M&A
Finally, Nagel outlined Mediobanca's future vision, explaining that the bank is ready to exploit theexcess capital , share in Generali to undertake M&A operations. “We want to focus on opportunities that can add value, rather than being impacted by operations that do not align with our strategic objectives,” concluded the CEO.
