By Pietro Lombardi

Italian bank Unione di Banche Italiane SpA is launching legal action over Intesa Sanpaolo SpA's takeover bid as it believes the coronavirus pandemic has triggered a condition that would make the offer invalid.

UBI said late Tuesday that it believes the bid is now ineffective as the pandemic has triggered a "material adverse change," or MAC, a condition which Intesa failed to waive "in a timely way."

"The judicial action is aimed at protecting the subjective rights of UBI Banca," the bank said in a statement.

Intesa declined to comment on the matter.

In February, Intesa launched a surprise all-share takeover bid for smaller rival UBI, valued at the time at $5.3 billion. The combination would create Italy's largest bank. In early May, Intesa said the strategic rationale of the deal was even stronger in the aftermath of the coronavirus pandemic .

Write to Pietro Lombardi at pietro.lombardi@dowjones.com

(END) Dow Jones Newswires

May 27, 2020 04:03 ET (08:03 GMT)

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