The noose is tightening around Lovaglio: his second spell at MPS risks ending badly

The noose is tightening around Luigi Lovaglio and his second spell at MPS risks ending badly. The latest blow comes from Crédit Agricole. CEO Olivier Gavalda has said that the French bank will not accept Monte dei Paschi’s bid for Banco BPM. This is no ordinary ‘no’: Crédit Agricole is BPM’s largest shareholder, with a 29.3 per cent stake, and BPM is in turn a shareholder in MPS. The refusal weakens Lovaglio’s plan to fend off the takeover bid from Intesa Sanpaolo and risks widening dissent. BPM’s rejection is not automatic, but it would be another blow. The day of reckoning is 29 October, when MPS will have to decide on the transactions with BPM and Banca Generali. Two-thirds of the represented share capital is required to approve the extraordinary resolutions. Lovaglio faces a substantial opposition front: Delfin holds 17.6 per cent of Monte dei Paschi, Caltagirone around 13.5 per cent, and Edizione dei Benetton 1.45 per cent. Together they account for over 32 per cent of the share capital and, adding Praude, the figure rises to around one-third. Their positions do not align: Caltagirone has announced he will vote against, whilst Delfin and Edizione have declared their support for Intesa’s offer. But the overall trend is the same, and it is becoming increasingly difficult for Lovaglio to secure the necessary votes.

A few days ago, Carlo Messina improved Intesa’s offer, raising the cash component from one euro to 1.25 euros per MPS share, in addition to the 1.6 Intesa shares, and presented shareholders with a choice: if the general meeting approves even just one of the key points of the counter-offer, his public takeover bid will lapse. Shareholders cannot vote for Lovaglio and retain Messina as a fallback. In this game of Risk, even the nuances matter. Delfin’s commitment in favour of Intesa was announced by Messina’s own bank, with the holding company’s consent: not two parallel statements, but a decision made public jointly. And the details matter. Giovanni Azzone, chairman of Cariplo, has also expressed his approval of the deal.

The question, therefore, is how Lovaglio can stand for election on 29 October without risking rejection. He could postpone the meeting, as Nagel did in 2025, by moving Mediobanca’s vote on Banca Generali to September. This would be a way of avoiding a head-to-head vote, not of stopping Intesa, whose bid is proceeding through the authorisation process. Lovaglio is capable of coming up with unpredictable moves, but this time time could be working against him. A postponement would look more like a delayed surrender than a new strategy. The most interesting game, however, goes beyond Siena and concerns Generali. If Intesa were to take over MPS, it would, through Mediobanca, acquire a central position in Generali’s shareholder structure. Recent developments suggest a possible four-way balance of power: Intesa, via Piazzetta Cuccia, UniCredit, Delfin and Caltagirone. No agreement has been announced, but the consensus that has emerged regarding MPS makes the scenario of a public company with strong shareholders and no single controlling shareholder seem less far-fetched. Such a structure would reshape Generali’s governance, forcing even Philippe Donnet to contend with a new balance of power.

In this plan, Unipol is helping to make the proposal viable. Carlo Cimbri has reassured stakeholders about the future of MPS: a merger with BPER would not mean the disappearance of the Siena-based bank, its brand or its local presence. Part of the branch network could remain with Intesa, but the aim would be to build a group centred on Monte dei Paschi, not to dismantle it piece by piece. This represents reassurance for employees, local communities and the government: the end of the Lovaglio project would not coincide with the end of MPS. Against this backdrop, Giancarlo Giorgetti, too, must come to terms with a scenario different from the one he had envisaged. The Minister for the Economy had supported the creation of a third banking hub centred on MPS and BPM. Now he may have to go along with a plan decided by others. BPM, too, could take a different path if the joint bid by UniCredit and Crédit Agricole – involving a subsequent division of assets – goes ahead. In short, the third banking hub could emerge with a structure different from that envisaged by the government (Giorgetti had done everything in his power to keep UniCredit away from BPM; today he is doing everything in his power to bring them back together). Intesa and Unipol could reshape MPS, whilst UniCredit and Crédit Agricole could determine BPM’s future; meanwhile, a new balance of power amongst major shareholders appears to be taking shape around Generali. Nothing has been decided. But whilst Lovaglio seeks the votes to save his counter-offensive, the market already seems to be planning for the post-Lovaglio era.