Italian backers of Carige have reportedly rejected BPER’s offer to acquire the troubled lender but are willing to have further discussions for the divesture.

As per Reuters’ report, the parties could not reach an agreement related to capital injection in ailing bank, Carige.

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BPER, a mid-sized bank, asked for $1.1bn capital to buy Carige. The lender submitted a non-binding bid for the troubled bank earlier this week.

Notably, the Italian unit of France’s Credit Agricole had also expressed interest in taking over Carige.

Italy’s depositor protection fund, the FITD stated that it could not meet BPER’s capital demand.

The FITD acquired an 80% stake in Carige after €600m rescue in 2019. Cassa Centrale Banca (CCB) has an 8.3% stake in the Genoa-based lender.

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Carige says it requires another €400m in the capital.

In October, UniCredit and the Italian government ended talks over the sale of Banca Monte Dei Paschi di Siena (MPS) after UniCredit set similar terms as BPER to buy MPS.

“The expression of interest contain terms and conditions to be discussed further which at present, for the part concerning the recapitalisation requested for Carige, are not in line with the fund’s by-laws,” the fund said in a note.

BPER has offered €1 to buy FITD and CCB’s combined 88.3% stake and plans to buy out the remaining stake for €70m.

A 20 December 2021 deadline has been set by BPER to enter exclusive talks. If the deal materializes, it will increase BPER’s assets by 20% to €150bn making it Italy’s fourth-largest bank.