Local fund is the mystery buyer of UniCredit's BOV shares

Local fund is the mystery buyer of UniCredit's BOV shares

Amalgamated Investments sign preliminary agreement to buy 10% of bank

Amalgamated Investments SICAV plc - whose main shareholder is the Testaferrata Moroni Viani family through Mercury plc - has emerged as the mystery buyer of UniCredit's shareholding in Bank of Valletta.

The preliminary agreement is subject to a number of conditions, including regulatory approval.

UniCredit SpA holds 52,500,439 shares in the bank, being 10.001 per cent of the issued shareholding. The market capitalisation of BOV on Monday was €929 million, meaning the value of the UniCredit shares was €93 million.

The news that UniCredit had reached an agreement to sell the shares was broken a few weeks ago by Bank of Valletta in a company announcement, but no news was given as to who had bought the shares.

Read: UniCredit, second biggest BOV shareholder, to sell its stake

Who are Amalgamated Investments?

Amalgamated Investments is a Malta-registered company set up in August 2000 which expressly targets experienced investors. 

The company has three directors - former APS Bank chairman Lino Delia, former APS Bank director Joseph Caruana and Norbert Tabone. 

According to its 2016 financial report, the company had assets of €64 million at the end of that year, with negligible liabilities of just over €50,000. 

The company already holds shares in other major banks.

How did UniCredit end up with BOV shareholding?

Banco di Sicilia SpA held 14.56% at the time that BOV was listed in 1992, when 34.23% was in the hands of the general public and the rest in government's hands.

In 1995, the government offered 12,000,000 shares to the public, thereby reducing its shareholding in BOV to 25.23%.

In June 2006, Capitalia took over the 14.56% stake in BOV from Banco di Sicilia, and on October 1, 2007, Capitalia  was merged with UniCredito Italiano by way of incorporation.

UniCredit posted an €11.8 billion loss for 2016 due to one-off hits stemming mainly from loan writedowns, with €17.7 billion in bad debts. This had forced it to raise €13 billion to rebuild its capital after the balance sheet clean-up.

Read: UniCredit kicks off record $14bn cash call to rebuild capital

Did this acquisition come out of the blue?

No, not really. When BOV stated last autumn that it was planning to issue €150 million in new share capital, UniCredit - which then had a stake of 14.55 per cent, confirmed via the prospectus that it would not be taking up its rights entitlement. Since it held around 61 million shares, it meant that 15.3 million shares were available for subscription.

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