Italy says won't sell MPS stake before M&A battle concluded

ROME, Aug 25 (Reuters) - Italian Economy Minister Giancarlo Giorgetti told regional politicians on Tuesday the Treasury will not sell its 4.8% stake in Monte dei Paschi di Siena (MPS) before an ongoing tussle for control of the Tuscan lender is concluded.

Giorgetti made the comments at a meeting in Rome with elected officials from Siena and the surrounding Tuscany region seeking answers about the future of Italy's third-largest bank.

Last week MPS announced two simultaneous bids, totalling about €34 billion ($39.7 billion), on rival Banco BPM and wealth manager Banca Generali.

The bids are a defensive move against a hostile takeover approach launched in June by market leader Intesa Sanpaolo <ISP.MI>, under which MPS would be broken-up.

TREASURY STAKE 'FROZEN'

"The minister told us the (Treasury) stake would be frozen until the (M&A) phase is over," Agnese Carletti, president of the Siena province, told Reuters after Tuesday's meeting.

Tuscany's regional president Eugenio Giani relayed the same comments by Giorgetti, and the minister's words were confirmed to Reuters by a Treasury source.

The Treasury was planning to sell its remaining shares in MPS via an accelerated bookbuilding procedure (ABB), but froze the process to avoid influencing the ongoing M&A battle, the source said, confirming a Reuters report early this month.

Banco BPM, whose main investor is France's Credit Agricole with a 29.3% stake, on Tuesday called MPS's bid "unsolicited", echoing comments last week by Banca Generali.

Banco BPM said after a board meeting that it would evaluate the offer, which does not include any premium on the bank's shares.

MPS will hold a shareholders' meeting on October 29 to approve its bids for Banco BPM and Banca Generali.

On that occasion the Treasury will assess its position, Giorgetti told the local politicians, Carletti said.

Intesa's investors are called to approve the bid on MPS on September 10, while the offer is expected to be launched as early as the end of next month.

($1 = 0.8568 euros)

(Reporting by Alvise Armellini, Silvia Ognibene in Florence and Andrea Mandalà in Milan; writing by Giulio Piovaccari; editing by Gavin Jones)