Crédit Agricole Proposes Merger to Create Italy's Third-Largest Bank

Crédit Agricole proposed a friendly merger between its Italian unit and Banco BPM, a move that would increase the French banking group's stake in the Milan-listed lender from 29.6% to approximately 45%. To secure the deal, Crédit Agricole offered Banco BPM shareholders a 20% valuation premium and a €1 billion special dividend.

The proposal seeks a whitewash procedure to exempt Crédit Agricole from a mandatory takeover offer. This process requires approval from a two-thirds majority of capital at an extraordinary shareholder meeting. If completed by the second half of 2027, the merger would create Italy's third-largest banking group, serving 6.5 million customers across 2,300 branches.

Crédit Agricole estimates the deal would generate €800 million in annual synergies and increase Banco BPM's 2027 earnings per share by about 24%. The combined entity would remain listed in Milan, and the current CEO of Banco BPM would remain in his position.