Banca Popolare Italiana may try to find a foreign ally to help revive its troubled take-over plan for Banca Antonveneta or resort to selling out, a source close to the situation said on Friday.
But the bank first needs to find out from market regulator Consob and the Bank of Italy whether its take-over bids, which have been suspended, will be scrapped or whether the authorities will ask for them to be modified, sources said.
Pop Italiana had looked to be the winner in a take-over battle for Antonveneta with Dutch bank ABN Amro until magistrates opened an investigation into the tussle and a judge impounded its Antonveneta shares and stripped its CEO of his powers.
The probe prompted regulators to freeze Pop Italiana's bids for Antonveneta in a scandal that has called into question the impartiality and future of Bank of Italy Governor Antonio Fazio.
Pop Italiana's board and the bank's acting CEO Giorgio Olmo agreed on Thursday to ask advisors Lazard and Dresdner Bank to consider its alternatives over Antonveneta.
"We must factor in a possible scrapping of the bids," a source close to the situation told Reuters.
"In that event, there are two options - either to seek a partner that can help support a new take-over or to seek an agreement for a possible sale (of the Antonveneta stake)."
The source said the partner was likely to be a foreign bank, but ruled out linking up with ABN. He added that Pop Italiana's board had asked its advisors to seek possible candidates and that the bank was not yet in any talks.
Media have reported that Deutsche Bank or Banca Intesa could get involved but the source said no names came up at Thursday's board meeting.
A second source said Pop Italiana would continue to seek a way of buying Antonveneta before resorting to finding a buyer for its nearly 30 percent stake in Antonveneta, Italy's ninth largest bank.
Pop Italiana's executives were due to meet Italian regulators in the coming days ahead of a new board meeting planned for the end of next week, sources said.
Pop Italiana and allies ratcheted up a huge stake in Antonveneta earlier this year and managed to block ABN's 26.5 euro a share take-over bid.
Pop Italiana launched two bids of its own, a mandatory cash bid at 24.47 euros a share and a mostly-paper bid it said valued Antonveneta at 27.50 euros a share. Both were suspended after the judicial inquiry exposed irregularities in the bids.
Analysts have said the best option would be for Pop Italiana to sell its Antonveneta stake to ABN, which said this month that it was still interested in Antonveneta.
But sources close to the situation said that opening talks with Pop Italiana's arch rival may not be easy.
"ABN needs to be taken into account, but it's considered with suspicion," one of the sources said.
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