Monte Paschi profit climbs as investors near call on Intesa's €34 billion bid

Profit beat sets the backdrop

Monte Paschi booked €543 million of third quarter net income, up about 15% from a year earlier and a notch above the average analyst forecast. The lift came from higher lending and fee income as rates climbed, and dividend income from its Generali stake added fuel.

Where the deal stands

Shareholders are weeks away from deciding whether the world's oldest bank stays on its own. The tender window opens at the end of November, and several investors, including the largest one, Delfin Sarl, have already said they will tender their shares.

Intesa is offering €1.25 in cash plus 1.6 of its shares for each Monte Paschi share, with the share component increasing to 1.644 after an interim dividend. At Thursday's close, the bid put Monte Paschi at roughly €34.3 billion, about in line with its market value. The deal already has the European Central Bank's signoff, and la Repubblica said Italy's antitrust authority is likely to clear it with extra conditions. To address competition issues, Intesa has said it will sell a large portion of Monte Paschi's branches following completion.

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Leadership pushback and next steps

Chief Executive Officer Luigi Lovaglio has tried to block the takeover with a counterplan to buy Banco BPM and Banca Generali, a move investors overwhelmingly rejected last week. He says he will keep pushing, arguing his defense already helped prompt Intesa to raise its bid once.

The board has not taken an official position on the offer. The bank said it is still reviewing the proposal and expects to finish that assessment before the month ends.

What it means for your portfolio

Earnings momentum gives supporters of a sale cleaner optics, but the consideration ties part of the value to Intesa's stock. With the ECB's signoff in hand, expected Italian antitrust clearance reported by la Repubblica, and several shareholders including Delfin Sarl saying they will tender, the decision is between exposure to Intesa's combined platform and sticking with Monte Paschi on a standalone track.

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