Banco BPM yesterday signed with the Covéa group the amending agreements of the partnership in the bancassurance sector currently in place and referring to the JV Bipiemme Vita, a company operating in the life and 81% owned by Covéa Coopérations and 19% by Banco BPM, and Bipiemme Assicurazioni, a non-life operating company wholly owned by Bipiemme Vita. Among other things, these agreements provide for Banco BPM's right to acquire 100% of the Company's share capital in the period between 8 September 2021 and 31 December 2023 and, therefore, allow Banco BPM to potentially align the the purchase of the investment in Bipiemme Vita with the exit mechanisms governed in the agreements relating to the partnership in bancassurance with Cattolica; more generally, Banco BPM will be able to benefit from greater flexibility in its choices in the medium-long term, in a sector characterized by high strategic importance in the light of both the significant growth potential and the opportunity to allow for a significant strengthening of the business model of the Group.
The amendments made to the pre-existing agreements, which provided for an exit 'window' through the exercise of a call option in favor of Banco BPM limited to the period from 8 September 2021 to 23 October 2021, regulate the procedures for continuing and concluding the partnership until, at the latest, the end of 2028. In particular, the agreements as amended provide for the recognition in favor of Banco BPM of an unconditional purchase option for 81% of the Company, exercisable at any time in the period between 8 September 2021 and 31 December 2023. In the event of failure to exercise this option, the partnership may continue until the end of 2028 except for the exercise of put and call options granted respectively to Covéa and to the Bank in specific time windows. The price for the exercise of the call by the Bank by 31 December 2023 will be equal to 81% of the regulatory capital represented by the Unrestricted T1 of Bipiemme Vita as at 30 June 2021 (substantially in line with that defined by the original agreements), decreased of any dividends collected and increased by any capital increases of Bipiemme Vita carried out until the transfer of the equity investment.
The prices of the put and call options envisaged starting from 2024 and up to 2028 will instead refer to the Unrestricted T1 of Bipiemme Vita at the time of the possible exercise of the option. The completion of the purchase by Banco BPM of the investment held by Covéa in Bipiemme Vita following the exercise of the options will be subject to obtaining the legal authorizations from the competent Authorities.
