Italy won't participate in Monte Paschi AGM on defence moves against Intesa

By Giuseppe Fonte

ROME, Sept 23 (Reuters) - Italy will abstain from a vote at a Monte dei Paschi di Siena (MPS) shareholder meeting called to approve defensive acquisitions to fend off a hostile takeover by Intesa Sanpaolo, Economy Minister Giancarlo Giorgetti said on Wednesday.

Giorgetti's stance means MPS' Chief Executive Luigi Lovaglio will get no direct assistance from the government in his efforts to derail Intesa's plan. The Treasury is one of the bank's largest shareholders through its 4.9% shareholding.

MPS, Italy's third-largest bank, has launched separate all-share bids worth a combined €34 billion euros ($39.46 billion) for Banco BPM and Banca Generali, as a defensive strategy against market leader Intesa.

Under Italian takeover rules, the transactions must be approved by at least two-thirds of shareholders voting at the Oct. 29 extraordinary meeting.

Key MPS investors also include businessman Francesco Gaetano Caltagirone and Delfin, the holding company of the Del Vecchio family that inherited the eyewear empire founded by the late Leonardo Del Vecchio.

"We will not participate, and we will abide by the market's decision regarding the outcome," Giorgetti told reporters in parliament when asked whether the ministry would vote at the meeting.

Bailed out by the state in 2017 and reprivatised in 2023-2024, MPS in June became ​the target of an unsolicited €36 billion takeover bid by ​rival Intesa which would break up the Tuscan lender.

Politicians from the Tuscany region and Siena, where MPS has central offices, have repeatedly urged the government to vote against Intesa at the shareholder meeting to preserve MPS in its current form.

"The market, with its supreme ability to discern, will reward whatever turns out to be the best offer," Giorgetti said.

Prime Minister Giorgia Meloni said in an interview last month she hoped MPS would not be "dismembered", a few days before Lovaglio announced the two simultaneous bids.

Analysts interpreted Meloni's remarks as distancing the government from Intesa's plan, although the prime minister also said Rome would take no active role in the banking M&A battle.

Italy has so-called "golden powers" it can use to block or set conditions on M&A deals affecting strategic sectors, including banks and insurers.

However, the government is unlikely to use these powers in any ongoing banking tussles, and if it does it will impose only minor conditions, a source with direct knowledge of the matter told Reuters.

(Editing by Gavin Jones)