Framework studied for UniCredit could apply in new plan.
DG-COMP may grant deal extension but M&A demands likely to stay Adds statement LONDON MILAN, Oct 24 Reuters - Italy's economy minister and UniCredit said on Sunday they had called off negotiations over the potential sale of ailing lender Monte dei Paschi MPS to UniCredit.
Despite the efforts from both sides, UniCredit and the Ministry of Economy and Finance announce that the negotiations pertaining to the potential acquisition of a defined perimeter of Banca Monte dei Paschi di Siena will no longer continue, they said in a joint statement.
The announcement comes after two sources told Reuters on Saturday that UniCredit and the Treasury were preparing to stop talks over the sale of MPS, after efforts to reach an agreement over a costly recapitalisation plan failed.
The decision to end talks complicates efforts by Prime Minister Mario Draghi's government to meet a mid 2022 deadline agreed with European Union authorities to reprivatise the bank Rome rescued in 2017.
Rome will now have to get clearance from Brussels to pump more money into Monte dei Paschi without a plan in hand to cut the state's 64% stake. It will also have to negotiate a new agreement with European authorities over its exit.