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Credit Agricole Italia welcomes Creval's response to merger bid, but pushes back on price

MILAN, March 31 (Reuters) - Credit Agricole Italia (CAI) on Wednesday welcomed comments by Creval’s chief executive in relation to its takeover offer for the Italian regional bank, but criticised its valuation of the bid.

The Italian arm of Credit Agricole in November said it would spend 737 million euros ($868 million) to expand its presence in Italy’s consolidating banking sector, its biggest market outside France.

On Monday Creval said a takeover offer by CAI was a good strategic move, but added that the price was too low.

CAI is offering 10.50 euros a share to buy out Creval investors, but the Italian lender said a fair price would be between 12.95 and 22.7 euros, based on analyses by advisers Bank of America and Mediobanca.

On Wednesday CAI said it “confirms the strategic rationale of the deal”, and “remains confident that the bank’s shareholders will seize the opportunity represented by the offer”.

But according to CAI, which is Creval’s largest shareholder, the valuations range calculated by the regional bank are “considerably wide” and “potentially misleading”.

It said a potential deterioration of the macro outlook due to the COVID-19 pandemic may hit Creval’s profit and the Italian lender “it is not a currently in the position to distribute any significant portion of the potential capital surplus”.

Shares in Creval, which closed at 12.19 euros on Wednesday, have consistently traded above the bid’s price. (Reporting by Andrea Mandalà; Editing by Jan Harvey)

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