[Source – in.marketscreener.com]
Berlin Pushes Back Against Cross-Border Deal
German Chancellor rejects UniCredit’s increased stake in Commerzbank, expressing strong opposition after the Italian lender announced it had raised its holdings from 9% to 21%. This move sparked concern in Germany, with Scholz stating that “hostile takeovers are not a good thing for banks,” signaling the government’s clear stance against the acquisition.
UniCredit has long eyed Commerzbank as a potential target but had previously assured that any merger would require government support. The German government remains firmly against the takeover, favoring Commerzbank’s independence.
A Surprise Move by UniCredit
On Monday, UniCredit revealed it had acquired an additional 11.5% of Commerzbank shares, further cementing its position as a major shareholder. The disclosure, which followed the purchase of a 9% stake—half of which came from the German government—caught German officials off-guard. A government representative stated that Berlin supports Commerzbank’s strategy of remaining independent, and communicated this position to UniCredit.
This escalation follows Berlin’s decision to halt plans to sell its remaining 12% stake in Commerzbank, a response to growing domestic opposition. While UniCredit has yet to secure approval from the European Central Bank (ECB) to lift its stake above 10%, the bank has structured the acquisition to settle once the necessary approvals are in place.
Political Tensions and Market Reactions
German Chancellor rejects UniCredit’s actions, which have sparked widespread opposition in Germany. Politicians, including opposition leader Friedrich Merz, have criticized the potential takeover, with Merz calling it a “disaster for the German banking sector.” Meanwhile, unions have voiced concerns over possible job losses and a negative impact on lending to Germany’s small and medium-sized enterprises (Mittelstand).
Germany warns Italy’s UniCredit against ‘hostile takeover’ of Commerzbank • FRANCE 24 English
Despite the backlash, Commerzbank’s shares rebounded sharply after UniCredit’s announcement, rising by 24% since the initial stake purchase. On the other hand, UniCredit shares dropped 2.5%, although they remain higher than before its stake became public.
Next Steps for UniCredit
UniCredit has expressed interest in raising its stake to 29.9%, a process that could take months and requires further ECB approval. The potential merger would mark a significant cross-border deal in European banking and could drive further consolidation in the sector. However, the move has ignited concerns about its impact on the German economy, and Chancellor Scholz’s government remains steadfast in its opposition.
