Bank Ifis announced the launch of a'public purchase and exchange offer (Opas) voluntary su Illimity Bank, For a value total of 298 million euros. This decision, taken by the board of directors chaired by Ernesto Fürstenberg Fassio, aims to acquire the entire block of shares of Illimity Bank, listed on the Euronext Star Milan segment.
As soon as the takeover bid was launched, the market reacted with enthusiasm. Immediately after the opening, the title di Illimity Bank jumped 9,7%, reaching 3,71 euros, well above the price offered by Banca Iphis. Banca Ifis shares also recorded a small jump of 1,3%, rising to 21,6 euros. During the day, however, prices continued with an even stronger performance: Illimity rose by 12,34%, reaching 3,8 euros per share, while Banca Ifis saw an increase of 2,62%, rising to 21,92 euros.
The next fundamental step for Banca Ifis will be theextraordinary meeting set for April 17, during which the members will have to approve thecapital increase necessary to support the takeover bid. The increase will be equal to 8,4 million shares, to be completed by 30 June 2026. The issue price of the new shares will be determined by the Board of Directors, as explained Frederik Geertman, CEO of Banca Ifis, during the call with analysts in which the operation was presented.
Details of the operation: 3,55 euros per share
The offer includes a equivalent of 3,55 euros for each Illimity Bank share, based on the official price of Banca Ifis shares on 7 January 2025 (3,39 euros). This amount includes 0,1 newly issued Banca Ifis shares for each share of Illimity Bank, plus a cash component of 1,414 euros. The offer is, of course, subject to approval by the competent authorities and other conditions.
If the offer is successful, a note explains, the merger by incorporation of Illimity Bank in Banca Ifis will further strengthen the latter's leadership position in the sector specialty finance, expanding its customer base in the SME market and consolidating its presence in the NPL (bad loans) sector. However, for the incorporation to take place, it will be necessary for at least 66,67% of Illimity Bank shareholders join the takeover bid, while the current main shareholders already hold 44,7% of the capital.
According to the document relating to the takeover bid, there is no agreement between the shareholders of the two banks. The main shareholders of illimity Bank are: Banca Sella Holding Spa (10%, by Maurizio Sella), FermION Investment Group Limited (9,4%, by Andrea Pignataro), LR Trust – FIDIM Srl (7,7%, of the Rovati family), Tensile – Metis Holdings Sarl (7,3%), Atlas Merchant Capital (6,3%) and Corrado It will pass (4%).
Why now? And when what are the timeframes?
What prompted Banca Ifis to make this move? 2024 was not an easy year for Illimity Bank: the title lost 38% in the last year and 75% compared to its all-time highs. This decline was largely caused by the downsizing of the non-performing loan business. In fact, Illimity has reoriented its business towards corporate lending. Not only that, the results for 2024 were not exciting: profit fell by 20%, from 39 to 31 million euros, and gross operating profit slipped from 71 to 68 million.
Regarding the timing of the operation, Geertman specified: “The takeover bid on illimity Bank will will close by September this year”, after having obtained the authorizations from Consob, between the end of May and the beginning of June with the launch of the offer in the middle of summer. The documents will be presented to the authorities within 20 days of the announcement of the operation: January 28, 2025, explained the top manager.
Governance and strategic objectives
From an industrial point of view, the merger promises very interesting synergies. The two banks, although operating in similar sectors, also present important complementarities. Illimity Bank will be able to take advantage of the vast Banca Ifis network, with its 28 branches, while the institute founded by Corrado Passera will be able to expand its presence in turnaround financing and investment banking for SMEs.
The transaction is expected to generate annual synergies of approximately 75 million euros. Of these, approximately 25 million will come from additional revenues, thanks to Banca Ifis' leadership in sectors such as factoring and leasing, while approximately 50 million will come from cost synergies, thanks to the integration of corporate structures and more efficient management of NPLs.
Financially, the operation will further diversify Banca Ifis' funding profile, increasing the group's stability: with a Pro-forma CET1 Ratio above 14%. Despite the Costs of integration estimated in about 110 million euro (and which will be sustained in 2025), future synergies should more than offset these expenses, generating positive long-term returns.
Illimity Bank shareholders will also benefit from Banca Ifis' ability to generate higher volumes and profits, together with a progressive dividend policy, with one of the highest payout ratios in the Italian market.
In addition to the financial aspects, this acquisition offers Banca Ifis an extraordinary opportunity to strengthen its commitment in the planet, especially in the social sphere.
Comments
“Banca Ifis' takeover bid for illimity Bank responds to the need to identify a strategic industrial solution aimed at expanding the Bank's leadership position in the specialty finance sector and accelerating its growth in a sustainable and long-term perspective, in line with our family vision as controlling shareholders – stated Ernesto Furstenberg Fassio, CEO of La Scogliera SA – .”The goal is to create a European industrial player capable of facing the challenges that the banking market requires of us with solidity and foresight, satisfying the expectations of all shareholders who decide to participate in the project and continue with us the success story of the Banca Ifis Group; a story that stands out for the levels of industrial and financial excellence achieved and for the sustainable approach to business management, for the benefit of businesses, people and our country”.
“The price proposed by Banca Ifis for Illimity is fair because it reflects the current value” of the bank founded by Corrado Passera, Geertman stressed during the call with analysts. The top manager added: “We believe that for Illimity shareholders the offer represents an opportunity, especially when compared to a stand-alone scenario”.
Finally, he highlighted an important aspect of the governance: “If the operation goes through, La Scogliera, the majority shareholder of Banca Ifis, will drop below 50% of the shares for the first time”.
Finally, Geertman promised a constant commitment to integration: “We will work hard to integrate Illimity into Banca Ifis”, he concluded, reiterating that the operation should be seen as an opportunity, also by virtue of Banca Ifis' successful track record.
Updated at 15:00 on Wednesday 8 January 2025
