Banca Monte dei Paschi di Siena SpA, Italy’s No. 3 bank and the world’s oldest, is up for sale, according to people familiar with the matter.
The Tuscan lender, the worst performer in Europe’s recent banking “stress tests,” has hired investment bankers at UBS and Citigroup to find a buyer or merger partner, the people said. The sale process formally got underway this week, after the same two investment banks lined up underwriters for a planned $3.09 billion stock sale for Monte dei Paschi.
Monte dei Paschi’s goal is to find a buyer or merger partner before the so-called rights offering is actually consummated, possibly making that offering unnecessary, these people say. The rights offering is expected to take place in the second quarter of 2015.
The people say UBS and Citigroup bankers are in the very early stages of identifying possible bidders for Monte dei Paschi, which was founded in 1472 and is considered the world’s oldest bank. The list includes midsize Italian rival UBI Banca, as well as some large European banks that already operate in Italy. Monte dei Paschi executives haven’t actually met with any potential suitors.
UBI previously has said it isn’t involved in any negotiations with Monte dei Paschi.
The list of potential buyers is limited by Monte dei Paschi’s deep problems. In last month’s stress tests, the bank was found to have a 2.1 billion euro capital shortfall — the biggest hole of any of the 150 banks that underwent the tests.
The magnitude of the shortfall surprised analysts, investors and bank executives, partly because Monte dei Paschi had raised 5 billion euros only a few months earlier.
Dow Jones Newswires
