Banca Popolare di Vicenza SpA sold an approximately 6.02% stake in Società Cattolica di Assicurazione - SC, reducing the bank's shareholding in the insurer to 9.05%.
Popolare di Vicenza sold 10.5 million ordinary shares in Cattolica Assicurazioni through an accelerated bookbuilding at a selling price of €7.25 per share, for a total of approximately €76.1 million. Upon completion, the bank will hold 15,767,793 shares in Cattolica Assicurazioni, which are subject to a 90-day lockup period.
EQUITA SIM SpA acted as sole book runner for the transaction, which Popolare di Vicenza said will be settled April 7 and will have a significant positive effect on its capital ratios.
Separately, Cattolica Assicurazioni exercised its put option on its insurance joint ventures with Popolare di Vicenza. The insurer will sell to the bank its 60% stakes in Ireland-based Cattolica Life Ltd. and Italy-based Berica Vita SpA and ABC Assicura SpA.
The value of the put option amounted to €186.1 million as of April 4. Cattolica Assicurazioni expects €8.6 million in penalties for the failure to achieve the joint ventures' underwriting and profitability targets.
It said it decided to exercise the put options "given the severe uncertainty of the situation which emerged from Banca Popolare di Vicenza's 2016 financial statements." Popolare di Vicenza reported a €1.9 billion full-year 2016 loss and has requested a "precautionary recapitalization" from the Italian government ahead of a planned merger with Veneto Banca SpA.