UniCredit and Alpha Services and Holdings announce merger in Romania and strategic partnership in Greece

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Bucharest, October 23, 2023by rbj – UniCredit S.p.A (“UniCredit”) and Alpha Services and Holdings S.A. (“Alpha”), 100% parent of Alpha Bank S.A. (“Alpha Bank”), announce that they have signed a binding term-sheet for the creation of a strategic partnership in Romania and Greece.

Merger of Romanian subsidiaries

The parties have agreed the key economic terms for the merger of UniCredit Bank S.A. (“UniCredit Romania”) with Alpha Bank Romania S.A. (“Alpha Bank Romania”), to create the third largest bank in the local market with a combined 12% market share by total assets. The merger combines two complementary franchises in a high growth country, with UniCredit Romania and Alpha Bank Romania having strong footholds in the corporate and retail segments.

Transaction closing is expected in 2024, subject to the completion of a due diligence process, corporate approvals for the merger and all necessary regulatory approvals and consents, including on anti-trust. Upon completion, Alpha Bank is expected to (i) retain 9.9% of the combined entity share capital and (ii) receive a cash consideration of Euro 300m. The cash component remains subject to post due diligence adjustments related to asset quality, if applicable.

The merger will grant customers of Alpha Bank Romania access to an enlarged range of services and products; and both parties will ensure continuity and quality of service to their clients throughout the period of transition.

Commercial partnership in the distribution of bancassurance, asset management and other banking products

UniCredit and Alpha have agreed key terms for:
a) the purchase by UniCredit of a 51% stake in AlphaLife Insurance Company S.A. (“AlphaLife”), a wholly-owned life insurance subsidiary of Alpha active in the pension and savings products segment;
b) the distribution of UniCredit onemarkets mutual funds through the Alpha Bank network, which serves more than 3.5 million clients in Greece.

This cooperation will leverage UniCredit’s expertise and breadth of products in the asset management and in the bancassurance space to accelerate the development of AlphaLife’s capabilities and enrich the wealth management offering available to Alpha Bank’s customers. It is an example of UniCredit’s factories adding value to third parties and a demonstration of its commitment to being the Bank for Europe’s future by distributing its best-in-class products into new markets.

Andrea Orcel, CEO of UniCredit Group, said in Bucharest : “This is the first acquisition that UniCredit has made in 15 years, signaling the inherent potential that we, as a business, see in Romania and in the Central and Eastern Europe region. The opportunity offered by this merger is significant not only for our current and future customers, but also for the employees of both institutions. I am excited that these two teams will come together and know that they will work more synergistically than would have been possible separately.

This acquisition is a testament to UniCredit’s commitment to increasing the quality and excellence of our product factories, not to mention the transformation that UniCredit has undergone over the past two years. Attracting a partner of this caliber and agreeing on a commitment like this would have been unthinkable for the old UniCredit and I am confident that this is the beginning of a success story for this bank in the Central and Eastern Europe region.”

The parties will also explore further collaboration opportunities to support their customers’ needs in their respective countries of presence, leveraging on their combined international footprint and origination capabilities in regional banking, transaction banking, syndicated lending, advisory, other market and corporate services as well as other banking services and products.

The final agreement on the commercial partnership is subject to completion of a due diligence process, corporate approvals and all necessary regulatory approvals and consents, including on anti-trust.

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