Italian bank UniCredit said on Wednesday it had increased its stake in Germany’s Commerzbank, intensifying takeover speculation and drawing condemnation from Berlin as an “unfriendly” move at a time when the country is in political limbo.
The story began in September when UniCredit surprised the markets and the German government by revealing that it had built a significant stake in Germany’s second-largest lender.
In its latest move, UniCredit, Italy’s second-largest bank, announced it had increased its stake in the German bank from 21 percent to about 28 percent.
A successful takeover by the Milan-based lender would amount to a major pan-European banking merger and some EU officials have backed the idea, saying it would create a heavyweight better able to compete internationally.
But the approach has sparked anger in Germany, with unions fearing it could lead to job losses and politicians – led by Chancellor Olaf Scholz – speaking out against a merger.
Following UniCredit’s latest announcement, the German government denounced the Italian bank for “again taking uncoordinated and unfriendly action” towards Commerzbank.
“Unfriendly attacks and hostile takeovers are inappropriate in the banking sector,” deputy government spokesman Wolfgang Buechner said at a regular news conference.
He also pointedly noted that UniCredit had “publicly emphasized that it did not want to take any further action” before Germany held early elections on February 23.
The elections come after the collapse of Scholz’s coalition government last month, and he currently leads a weak minority government unable to pass major bills.
– ‘Political vacuum’ –
The Italians’ latest move comes despite UniCredit CEO Andrea Orcel stressing last month that he did not believe exploiting the political turbulence with a takeover bid would be the “right thing to do”.
CMC Markets analyst Jochen Stanzl also said that going further at this point could be a mistake for UniCredit.
“It would not be advisable for Unicredit to take advantage of the political vacuum in Berlin for a takeover,” he told AFP.
“Some of the players could at least still be part of a government after the elections, and that should not be used to make enemies.”
Following its latest move, UniCredit said its position in Commerzbank now stood at about 28 percent, of which 9.5 percent came through a direct stake and about 18.5 percent through derivatives.
UniCredit’s progress reflects its “belief in Germany, its businesses and communities, and the importance of a strong banking sector for driving German economic development,” the bank said.
However, it added that it was proceeding cautiously, to provide “full flexibility and optionality” as it pursued what it said was “substantial value” in Commerzbank.
UniCredit said the additional investment would not affect its bid for Italy’s third-largest bank, Banco BPM, which has also led to some resistance in Italy.
Commerzbank declined to comment on the latest development.
A large portion of UniCredit’s shares were purchased directly from the German government, which sold them as it wanted to reduce its position in Commerzbank.
Berlin still has a 12 percent stake in the lender, the legacy of a government bailout during the 2008 global financial crisis.
Buechner said the German government, as a major shareholder, “continues to support Commerzbank in its strategy and independence,” noting that the lender was “systematically important.”
He said UniCredit had previously described its stake in Commerzbank as a “pure investment that could be dissolved at any time”.
“The federal government expects UniCredit to make use of this opportunity.”
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