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UniCredit's Bid for Banco BPM Sparks Concerns Over Job Losses and Strategic Implications

The Italian government is exploring options to counter UniCredit's takeover bid for Banco BPM, despite official denials of drafting an emergency decree.

The Italian government is reportedly exploring various strategies to counter UniCredit's ambitious takeover bid for Banco BPM, a move that has stirred significant political and economic discussions. According to reports from the Financial Times, the government, led by Prime Minister Giorgia Meloni, is considering an emergency decree to circumvent the 'passivity rule,' which restricts the target company's ability to fend off a takeover without shareholder approval. This rule currently prevents Banco BPM from taking defensive actions against UniCredit's unsolicited 10 billion euro offer.

Despite these reports, the Italian Treasury has officially denied any plans to draft such a decree, labeling the Financial Times' report as "totally groundless." The Treasury's statement comes amid concerns that UniCredit's bid could disrupt the government's plans to merge Banco BPM with Monte dei Paschi di Siena, aiming to create a stronger banking entity in Italy.

UniCredit's proposal has not only been rejected by Banco BPM for undervaluing the bank but has also caused friction within the Italian government. The right-wing nationalist League party, a coalition partner, has expressed significant irritation over the deal, which they believe could undermine national economic interests.

In response to the complexities of the takeover, UniCredit has engaged Deloitte LLP for advisory services, although it has yet to finalize its financial advisers. The situation remains fluid, with the Italian government weighing its options to protect strategic national assets under its golden power legislation, which allows intervention in foreign takeovers of critical companies.

As the situation develops, the financial and political implications of UniCredit's bid continue to unfold, with stakeholders closely monitoring the Italian government's next moves.

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