The fools over at Unicredit, Italy’s largest bank, have spent upwards of $60b in brainless mergers over the past decade. Now they’re broke and in dire need of capital, almost equal to their market cap.
The company seeks to raise $14b in a rights offering and will meet with shareholders on Thursday to figure out how in the world they’re going to pull this off — considering no one is in the least bit interested in throwing money at bankrupt Italian banks (see Monte Paschi).
With the cash, Unicredit intends to eat heavy losses on bad loans which the bank will finally get off its books.
Their pitch is that they need the new capital to clean up theit act, not for survival.
Sure.
“UniCredit is finally addressing once and for all the legacy problem represented by the non-core credit portfolio,” Luigi Tramontana, an analyst at Banca Akros SpA, wrote in a Dec. 22 report. “The rights issue stands at the top of the expectations, given the stronger-than-expected effort to increase non-performing exposure coverage.”
Literally no one cares about these issues anymore.
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They’re Going Out. Buh Bye.!