Banco Bpm Spa · MIL:BAMI
Banco Bpm Spa — Merger or Acquisition (April 2025)
30 slides from Banco Bpm Spa's merger presentation, Apr 24, 2025
Slide 1: BBPM Board's Considerations on the Voluntary Public Exchange Offer by UniCredit
BBPM’S BOARD OF DIRECTORS’ CONSIDERATIONS ON THE VOLUNTARY PUBLIC EXCHANGE OFFER PROMOTED BY UNICREDIT S.P.A. Issuer’s Notice April 24, 2025
Slide 2: Disclaimer
DISCLAIMER THIS IS AN ENGLISH COURTESY TRANSLATION OF THE ORIGINAL DOCUMENT PREPARED IN ITALIAN. IN THE EVENT OF INCONSISTENCIES, THE ORIGINAL ITALIAN VERSION OF THE DOCUMENT SHALL PREVAIL OVER THIS ENGLISH COURTESY TRANSLATION. This document does not constitute and shall not be construed as a publi
Slide 3: Agenda
AGENDA Introductory Remarks 1 BBPM’s Distinctive Features and Growth Prospects 2 Considerations on the Offer and Assessment of the Risk Factors 3 BBPM’s Board of Directors Review of the Offer Consideration 2
Slide 4: Introductory Remarks
Introductory Remarks 3
Slide 5: Reference Context and Purposes of the Document
REFERENCE CONTEXT AND PURPOSES OF THE DOCUMENT REFERENCE CONTEXT PURPOSES OF THE DOCUMENT On 25 November 2024 UCG has announced a total public The purpose of this document is to present to BBPM exchange offer on BBPM shares (the “Offer”) Shareholders and to the other stakeholders of the bank the
Slide 6: Main Challenges Encountered in Assessing the Offer
MAIN CHALLENGES ENCOUNTERED IN ASSESSING THE OFFER A UCG-BBPM combined business plan is not As of today, three Offer conditions are not available fulfilled(1) LACK OF CLARITY UNCERTAINTIES ON BBPM Shareholders cannot even rely on a REGARDING THE Nevertheless, UCG retains the right to termina
Slide 7: The Golden Power Decree Provides for Additional Elements of Risk
THE GOLDEN POWER DECREE PROVIDES FOR ADDITIONAL ELEMENTS OF RISK FOR BBPM SHAREHOLDERS IN CASE THEY ADHERE TO THE OFFER The Golden Power decree dated 18 April 2025 imposes several requirements on UCG, entailing further significant elements of uncertainty and risk that must be carefully considered by
Slide 8: 1. BBPM's Distinctive Features and Growth Prospects
1. BBPM’s Distinctive Features and Growth Prospects 7
Slide 9: Distinctive Features of BBPM
DISTINCTIVE FEATURES OF BBPM WELL-ESTABLISHED DISTRIBUTION NETWORK IN THE MOST DYNAMIC SOLID AND COMPREHENSIVE BUSINESS MODEL WITH BOTH AREAS OF THE COUNTRY PROPRIETARY PRODUCT FACTORIES AND JOINT VENTURES WITH ~76% of BBPM’s retail branches located in Northern Italy LEADING SPECIALISED OPERATORS
Slide 10: BBPM Offers Significant Growth and Value Creation Prospects
BBPM OFFERS SIGNIFICANT GROWTH AND VALUE CREATION PROSPECTS AN UPDATED AND CREDIBLE STRATEGIC PLAN BASED ON CLEAR TOP SHAREHOLDER REMUNERATION GUIDELINES WHILE KEEPING A SOLID CAPITAL POSITION Update of the Strategic Plan, extended to 2027, as a result of the strong results Total Shareholders re
Slide 11: BBPM Has Built a Successful Track Record
BBPM HAS BUILT A SUCCESSFUL TRACK RECORD RESULTS EXCEEDING EXPECTATIONS AND SIGNIFICANT VALUE BUSINESS MODEL STRENGTHENED BY SUCCESSFULLY COMPLETED CREATED FOR SHAREHOLDERS EXTRAORDINARY TRANSACTIONS OVER THE PAST 10 YEARS Transformation from a traditional commercial bank to a diversified financia
Slide 12: 2. Considerations on the Offer and Assessment of the Risk Factors
2. Considerations on the Offer and Assessment of the Risk Factors 11
Slide 13: UCG's Business Model Entails Several Points of Attention
UCG’S BUSINESS MODEL ENTAILS SEVERAL POINTS OF ATTENTION By the end of the Strategic Plan, also thanks to Anima, non- BBPM’S REVENUE MIX interest income will account for approximately half of BBPM’s total UNICREDIT APPEARS TO BE MORE revenues Strategic plan Consensus BALANCED AND LESS RELIANT ON N
Slide 14: Impact of UniCredit's Strategic Decisions on Shareholder Distribution Ambitions
THE IMPACT OF UNICREDIT’S STRATEGIC DECISIONS ON ITS SHAREHOLDER DISTRIBUTION AMBITIONS REMAINS UNCERTAIN €6.5 billion of excess capital declared by UCG – which, based on the information provided to the market, corresponds to a CET1 Ratio target threshold of 12.5%, equivalent to the lower end of the
Slide 15: UCG's Presence in Russia Exposes Shareholders to Significant Risks
UCG’S PRESENCE IN RUSSIA EXPOSES SHAREHOLDERS TO SIGNIFICANT RISKS IN THE CURRENT GEOPOLITICAL CONTEXT In case of an exit from Russia, UCG communicated an exposure to a maximum P&L potential loss of €5.5 billion • UCG did not provide further details on the additional potential impact of a devaluatio
Slide 16: Absence of an Updated UCG Business Plan Adds Uncertainties
THE ABSENCE OF AN UPDATED BUSINESS PLAN OF UCG ADDS FURTHER UNCERTAINTIES ON THE ENABLING FACTORS OF THE ANNOUNCED LEVELS OF “GUIDANCE 2025” AND “AMBITIONS 2027” MAIN UNCERTAINTIES UniCredit estimates a “moderate decline” of Net Interest Income in 2025, without providing Absence of an updated Net
Slide 17: UCG Has Reduced Its Lending in Italy, While BBPM Is Rooted Locally
UCG HAS REDUCED ITS LENDING IN ITALY, WHILE BBPM'S BUSINESS IS ROOTED LOCALLY, WITH A STRONG FOCUS ON SUPPORTING SMEs AND FAMILIES LOANS TO ITALIAN CUSTOMERS BETWEEN 2021 AND 2024 (base 100) 100 BBPM reduced loans in line with market Expected negative dynamics, maintaining a loan-to-deposit 95 95 ~-
Slide 18: Lack of Details on Envisaged Synergies and Their Phasing
THE LACK OF DETAILS ON THE ENVISAGED SYNERGIES AND THEIR PHASING REPRESENTS A FURTHER RISK FACTOR IN EVALUATING THE FINANCIAL APPEAL OF THE OFFER 1 2 UCG HAS QUANTIFIED THE EXPECTED SYNERGIES, NO COMPREHENSIVE EXPLANATION PROVIDED WITHOUT PROVIDING FURTHER DETAILS ON HOW SYNERGIES COULD BE ACHIEVED
Slide 19: UniCredit Has Not Completed Integrations Comparable to BBPM
UNICREDIT HAS NOT COMPLETED ACQUISITIONS OR INTEGRATIONS OF BUSINESSES COMPARABLE TO BBPM “Hostile” or non-agreed acquisition and/or combination transactions present a potential execution risk and higher complexity compared to other situations, with uncertain and unforeseeable impacts for stakeholde
Slide 20: 3. BBPM's Board Review of the Offer Consideration
3. BBPM’s Board of Directors Review of the Offer Consideration 19
Slide 21: Consideration – Alternative Scenarios
CONSIDERATION – ALTERNATIVE SCENARIOS In the Offer Document, UCG represented three alternative scenarios. As of the Date of the Issuer’s Notice, the official Consideration is on a temporary basis the Ex-UCG Dividend Consideration (hence equal to 0.182 UCG Shares for each BBPM Share) Reference dates
Slide 22: Board Highlights Five Main Reasons the Offer Is Unsatisfactory
THE BOARD OF DIRECTORS HIGHLIGHTS FIVE MAIN REASONS WHY IT BELIEVES THAT THE OFFER IS UNSATISFACTORY FOR BBPM SHAREHOLDERS 1 The Consideration is inadequate from a financial point of view As at the Reference Date(1), the Consideration does not recognize any premium to BBPM Shareholders and is at a 2
Slide 23: The Consideration Is Inadequate from a Financial Point of View
1 THE CONSIDERATION IS INADEQUATE FROM A FINANCIAL POINT OF VIEW The Board of Directors reviewed the financial analyses of BBPM’s financial advisors, as described in the Issuer’s Notice, and identified the following implied exchange ratio ranges, as well as the related average and median value, whic
Slide 24: Consideration Does Not Recognize Any Premium to BBPM Shareholders
2 AS AT THE REFERENCE DATE, THE CONSIDERATION DOES NOT RECOGNIZE ANY PREMIUM TO BBPM SHAREHOLDERS AND IS AT A DISCOUNT TO THE PRICE OF THE BBPM SHARE Assuming a premium of c.45% on the market price of the BBPM Shares on 22 November 2024, in line with the two most recent tender offers successfully co
Slide 25: The Price of the BBPM Share Does Not Reflect Its Fundamentals
3 THE PRICE OF THE BBPM SHARE DOES NOT REFLECT THE FUNDAMENTALS OF BBPM BBPM Official price Average of research analysts’ (as at the Reference Date) target prices1 AS AT THE REFERENCE DATE, THE AVERAGE RESEARCH ANALYSTS’ TARGET PRICES REFLECT A 10% POTENTIAL INCREASE €9.13 €10.04 (cum dividend) Aver
Slide 26: Consideration Entirely in UCG Shares: Performance and Valuation
4 THE CONSIDERATION IS ENTIRELY IN UCG SHARES, WHOSE PERFORMANCE AND VALUATION COMPARED TO BBPM SHARES NEED TO BE CAREFULLY CONSIDERED UCG IMPORTANT INITIATIVES UNDERTAKEN AFTER THE OFFER LIMITED VISIBILITY ON THE DRIVERS UNDERLYING THE MEDIUM- ANNOUNCEMENT AND THE OPERATING RESULTS GROWTH LONG TERM
Slide 27: Consideration Entirely in UCG Shares: P/E Comparison
4 THE CONSIDERATION IS ENTIRELY IN UCG SHARES, WHOSE PERFORMANCE AND VALUATION COMPARED TO BBPM SHARES NEED TO BE CAREFULLY CONSIDERED The comparison between UCG and BBPM P/E multiples, each calculated as the ratio between current market price and the consensus earnings per share (EPS) estimates, is
Slide 28: Consideration Creates Value Exclusively for UCG Shareholders
5 THE CONSIDERATION CREATES VALUE EXCLUSIVELY TO UCG SHAREHOLDERS, AT THE EXPENSE OF BBPM SHAREHOLDERS BBPM’s 2027 expected Net Profit of Euro 2.15 billion represents approximately 18% of the combined entity's net profit pre-synergies. Based on the Consideration, BBPM Shareholders would be entitled
Slide 29: Consideration Creates Value Exclusively for UCG Shareholders: Value Transfer
5 THE CONSIDERATION CREATES VALUE EXCLUSIVELY TO UCG SHAREHOLDERS, AT THE EXPENSE OF BBPM SHAREHOLDERS At an illustrative P/E multiple of 8x, the lower Net Profit attributable to BBPM Shareholders compared to the standalone scenario implies a value loss of approximately Euro 2.4 billion (also consid
Slide 30: Final Remarks
FINAL REMARKS BBPM Shareholders cannot rely on a consolidated UCG-BBPM strategic plan, nor on any details on the THE OFFER ENTAILS announced synergies. At the same time, UCG, despite three conditions of effectiveness already not fulfilled, ELEMENTS OF UNCERTAINTY retains the right to withdraw the Of