Commerzbank's share ownership shifts as UniCredit raises stake to 28%
UniCredit, the Italian banking giant, has taken a significant step in the European banking sector by increasing its stake in Commerzbank, Germany's second-largest lender, to around 28%. This strategic move, achieved through converting synthetic positions into shares, bolsters UniCredit's voting rights and control without triggering mandatory takeover rules [1][3].
The implications of this growing share are far-reaching. UniCredit's increased influence in Commerzbank could lead to cross-border influence in the European banking sector and potential pressure on Commerzbank's strategic decisions. However, Commerzbank views UniCredit as a competitor rather than an ideal shareholder, reflecting tensions between the two banks [2][4].
Commerzbank's management has adopted a defensive strategy to counter UniCredit’s ambitions, including bolstering its own share structure and emphasizing its independence. This defensive posture is indicative of the German bank's efforts to preserve its autonomy amid foreign shareholder pressures [2][4].
The German government's response to UniCredit's growing share is implied through Commerzbank's defensive strategy and regulatory frameworks that prevent a hostile takeover until UniCredit reaches or exceeds 30%. No direct government intervention has been reported yet, but regulatory scrutiny and an environment favouring takeover resistance are evident [3][4]. This stance illustrates Germany's cautious approach to preserving Commerzbank's autonomy amid foreign shareholder pressures.
Marco Troiano, head of financial institutions at Scope Ratings, stated that UniCredit's stake increase positions the bank to exert greater influence over Commerzbank's management [3]. JPMorgan analyst Delphine Lee believes UniCredit needs government support for the deal to happen [6].
UniCredit's CEO, Andrea Orcel, previously stated that the bank was content to wait until after Germany's federal election in February to make a decision on its Commerzbank investment [7]. Commerzbank labor representatives have called UniCredit's stake-building "activist and hostile" [5].
The ECB and BaFin have declined to comment on UniCredit's stake increase in Commerzbank. German rules require UniCredit to make an alternative cash bid if it were to bid for Commerzbank within six months of acquiring at least 5%. If UniCredit's stake goes beyond 30%, it would be required to make a bid for full acquisition [1].
It is important to note that UniCredit has also launched a €10.1 billion bid for domestic rival Banco BPM [8]. Commerzbank had no comment on UniCredit's announcement beyond pointing to its strategy. The physical stake of UniCritic in Commerzbank is currently 9.5%. Commerzbank is set to present its strategy to investors on Feb. 13 [2].
In conclusion, UniCredit's strategic move to increase its stake in Commerzbank to around 28% represents a significant shift in the European banking sector. Tensions between the two banks are evident, with Commerzbank viewing UniCredit as a competitor and adopting a defensive strategy. The German government and regulatory environment support takeover resistance, indicating a cautious approach to preserving Commerzbank's autonomy amid foreign shareholder pressures.
This strategic move by UniCredit could potentially influence the finance and investing decisions of both Commerzbank and the European banking sector, as UniCredit's increased stake provides greater control and influence. Meanwhile, Commerzbank's defensive strategy, bolstered by the German government's regulatory frameworks, indicates an effort to maintain its business independence amid foreign shareholder pressure.
