Police called in over battle for Italian bank

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The Independent Online

Milan prosecutors have opened an investigation into the bitter takeover battle for Banca Antonveneta, focusing on possible market rigging and regulatory obstruction.

Milan prosecutors have opened an investigation into the bitter takeover battle for Banca Antonveneta, focusing on possible market rigging and regulatory obstruction.

Banca Popolare di Lodi and the Dutch group ABN Amro are both vying to take over Antonveneta, one of the country's top 10 banks, in what is being seen as a test case for cross-border mergers involving Italy.

Prosecutors opened the investigation after "interested parties" close to ABN lodged a complaint on Thursday. No one has been named as a target of the investigation, which focuses on possible market rigging and obstructing the work of the stock market regulator Consob, sources said.

Italy's finance police seized documents from Lodi, it was reported.

ABN's €6.3bn (£4.3bn) bid suffered a serious setback over the weekend after Antonveneta's board, which had agreed to the takeover, was ousted and replaced with candidates supported by Lodi, a much smaller, regional bank which has made a counter-bid aimed at keeping out a foreign bidder.

ABN alleges that the Bank of Italy allowed Lodi to build up a bigger stake than the 21 per cent of Antonveneta controlled by its Dutch rival, despite concerns over Lodi's solvency that would normally have forced an intervention by the regulator. The European Commission will this week demand that the Bank of Italy explains its conduct.

ABN's deal would be the first foreign takeover of a major Italian bank. Brussels is investigating whether the Italian authorities have acted against common market rules and discriminated in favour of the local bidder. The Commission said yesterday it had yet to receive a reply from the Bank of Italy and was demanding a response by tomorrow.

ABN has said it will seek to overturn Saturday's vote and has launched a legal challenge. It says Lodi and supporters were acting in concert. Lodi has denied having any agreements with other shareholders, but Consob is investigating. If proof of concert is found, Lodi could be required to launch a full buyout of Antonveneta in cash.

ABN launched its €6.3bn bid - worth €25 per share - in March. Lodi made its bid on Friday, mostly in shares and bonds, which it valued at €26, although analysts said that using market values the offer was worth less than ABN's.

Gianpiero Fiorani, Lodi's chief executive, said last week "Italian banks must remain in Italian hands. We are convinced of the need for a bigger company that can unite economic interests with the nation's".

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