The OPS launched by Mediobanca on Banca Generali puts small shareholders at risk, potentially exposing them to legal and governance risks. Francesco Dagnino, managing partner at Lexia and former vice president of the Italian Association for the Exercise of Shareholder Rights (Aieda), highlights to Adnkronos that the decision to be asked of shareholders could take place within an incomplete information framework, where the term sheet – a non-binding document that precedes an agreement yet to be defined – risks leaving room for uncertainty and potential changes in the conditions. If Mediobanca were to waive the partnership condition outlined in the term sheet, it would generate further uncertainty in the shareholders’ decision-making process. These uncertainties may be heard by Consob.
What potential legal or governance risks may arise for small shareholders in such an OPS?
There is a risk that shareholders will have to decide on the offer in an incomplete information framework. Typically, a term sheet is a non-binding document containing the main terms and conditions of an agreement that still needs to be negotiated: there is agreement on certain points, but it is not binding. Legally, the partnership condition can be waived by Mediobanca. Asking shareholders to decide to build relationships without a clear framework, without knowing whether the agreement is final and what the terms and conditions are, is a risk. It is possible that it will never turn into a final contract, and if it does, the conditions could change radically from those indicated in the term sheet.
What can small shareholders do to protect themselves?
Shareholders could protect themselves by reporting the facts to Consob and requesting intervention, as Consob is the regulatory authority responsible for overseeing the behavior of issuers and offerors to protect the position of shareholders.
What could Consob decide?
Consob may ask for more detailed, complete, or long-term information. It may intervene by extending the protection of the offer for up to 55 trading days or even prohibit it entirely. The condition for proceeding is that the offer document is approved by Consob. If this happens, the OPS could not be executed.
What is the most recent legal framework regarding this type of operation?
The legal framework is well-established in this area. OPS differ from OPAs in that the consideration in the case of OPS is financial products, not cash, unlike in public purchase offers. Additionally, OPAs involve a consideration that is partly cash and partly financial products. In recent months, there have been many public exchange offers or public purchase exchange offers, which were less frequent in the past.
Why so many OPS and not OPAs?
These are operations of such scale that they would not be feasible if the price were in cash.
What are the critical legal aspects and main regulatory implications of an OPS like the one launched by Mediobanca on Banca Generali?
This operation was promoted during the public exchange offer announced by MPS on Piazzetta Cuccia shares. It is subject to the passivity rule, which requires Mediobanca not to undertake any actions that could hinder or complicate the operation, unless authorized by the General Assembly. This is why Mediobanca convened the assembly, to authorize the OPS on Banca Generali, as it is necessary in the presence of the passivity rule.
