Italian bank Mediobanca on Tuesday rejected a takeover offer by state-backed rival Monte dei Paschi di Siena , saying a tie-up would be detrimental to its shareholders because it lacked any strategic and financial rationale.

Mediobanca rejected a €7bn takeover bid from MPS, calling it “destructive of value” and warning it would weaken its business model.

The expected rejection of Mediobanca raises the quorum for the validity of the takeover bid launched by Monte dei Paschi and makes the battle more uncertain