Milan prosecutors have launched a significant investigation into alleged market manipulation and obstruction of regulators, focusing on Banca Monte dei Paschi di Siena (MPS), its Chief Executive Officer Luigi Lovaglio, and two prominent Italian investors: billionaire Francesco Gaetano Caltagirone and Delfin Sarl, chaired by Francesco Milleri. The probe centers on an alleged multiyear strategy to gain control of Mediobanca SpA, with the ultimate objective of tightening their grip on Assicurazioni Generali SpA, Italy’s largest insurer.

According to judicial documents reviewed by Reuters and Bloomberg, the investigation describes an alleged coordinated effort between Caltagirone and Delfin, two of the largest investors in both Mediobanca and Generali, to orchestrate Monte Paschi's acquisition of Mediobanca. Prosecutors claim this intricate plan was executed in breach of Italian market rules and involved coordinated behavior designed to influence Mediobanca’s share price, without proper disclosure to market authorities and other investors. A key accusation is that this concealed coordination allowed participants to avoid pooling their stakes, thereby bypassing the obligation to launch a costly mandatory cash takeover bid once their combined stake in Mediobanca surpassed the 25% threshold.

A crucial element of the alleged scheme involved the Italian government's re-privatization of MPS, which had been bailed out in 2017. Italy began reducing its 68% holding in MPS in November 2023, in line with commitments to European Union authorities. The final share placement, occurring in November 2024, notably brought Caltagirone and Delfin onboard as shareholders, alongside Banco BPM and fund manager Anima. Prosecutors allege that this sale was structured to favor buyers aligned with the Mediobanca takeover plan, pointing to Caltagirone and Delfin offering the same price for the same number of shares within minutes of each other. The rapid closing of the order book during this accelerated bookbuilding process is said to have shut out other interested investors, such as UniCredit SpA and BlackRock Inc.

While Italy’s Finance Ministry and its representatives are not under investigation, the judicial documents raise questions about the government’s role, characterizing the sale as one of "opacity and anomalies." It appeared steered toward predetermined buyers, prompting concerns over potential conflicts of interest given the Treasury’s dual role as both seller of the stake and, belatedly, a backer of Monte Paschi’s offer. Despite these allegations, an official from Italy's economy ministry maintained that the ministry "always acted in compliance with rules and standard practices" in placing shares. Prime Minister Giorgia Meloni’s government and the Finance Ministry in Rome are not subjects of the investigation.

Both MPS and the two major shareholders have vehemently denied any wrongdoing. Monte Paschi stated its confidence in providing necessary information to clarify the correctness of its actions. Delfin's board affirmed it "always acted in full compliance with market rules and laws," while Caltagirone Group representatives asserted they "consistently acted in accordance with the rules governing the market." All parties have expressed confidence that the investigation will ultimately exonerate them.

The origins of this alleged project are traced back almost a decade, with Delfin and the Caltagirone group holding significant stakes since at least 2016. Mediobanca is the largest shareholder in Generali with a 13.2% stake. Delfin owns 10.1% of Generali, and Caltagirone controls 6.3%. Furthermore, Delfin holds 17.5% in Monte Paschi, and Caltagirone has a 10.3% stake, positioning them among MPS’s largest shareholders. The overlapping stakes in Generali, Mediobanca, and MPS are seen by investigators as creating a dense web of influence, with stakes allegedly rising in lockstep and voting behavior becoming increasingly aligned since 2019.