Italy's fifth-largest bank BPER Banca has improved its offer for ailing peer Carige to prevail over rival suitor Credit Agricole Italia, two sources close to the matter have said.
Before Christmas, BPER had offered a token €1 for Carige and demanded a €1 billion capital injection from the depositor protection fund (FITD) that owns the Genoa-based lender following a 2019 industry-financed bailout.
That sum exceeded the €700m the FITD, which is financed by Italian banks, was allowed to spend based on the previous year's contributions by members.
After the fund rejected BPER's initial offer, the Italian arm of France's Credit Agricole filed its own proposal for Carige requesting a lower capital injection, sources had previously told Reuters.
However, BPER remained the favoured bidder with Italian institutions keen to see the country's mid-tier lenders tie up.
In addition, some FITD members were wary of further expansion by Credit Agricole Italia, which last year acquired small regional bank Creval for €1 billion.
Newspapers Il Messaggero and Il Sole 24 Ore on Friday reported that US fund Cerberus was also in the running. Cerberus declined to comment.
Late on Saturday BPER's board approved a new proposal for Carige with a reduced capital request and better terms for a takeover bid, the two sources said. BPER declined to comment.
Daily Il Messagero reported on Saturday that BPER would ask for just €600m from FITD.
The fund, which owns 80% of Carige after spending €600m to rescue it, on Thursday said its steering committee was expected to select a bidder at a meeting today to enter exclusive negotiations.
To ease a sale of Carige and solve a long-standing banking headache, Rome has lined up tax incentives worth some €400m.
If the deal with FITD goes through, BPER said last month that it would begin a mandatory takeover offer on the remaining capital of Carige for €0.80 a share.
BPER is now ready to pay a higher takeover price, sources said, after shares in Carige rose nearly a third since mid-December to close to €0.885 on Friday.
