UniCredit CEO Andrea Orcel was interviewed at the World Economic Forum (WEF) in Davos, Switzerland on January 18, 2024.
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UniCredit BankChief Executive Andrea Orcel revealed this week that the Italian bank holds a 9% stake in the company. Commerzbank –A takeover of the German rival is still possible.
UniCredit faces a series of hurdles before it can increase its stake after making a request “that could exceed 9.9% of Commerzbank if necessary”. Shares in Commerzbank soared on Wednesday following news of UniCredit’s stance, and rose further on Thursday on speculation of an imminent takeover.
“All options are on the table,” Oser said in an interview with Bloomberg Television on Thursday. He stressed that “it would be very simple to engage with all the stakeholders and see if there is a basis for a merger. If not There is, that is the basis for sponsoring or driving Commerzbank further towards… transformation, then we will also bring a lot of value to our shareholders.
About half of UniCredit’s new stake was purchased from Commerzbank’s largest shareholder, the German government, which is seeking a gradual exit after injecting 18.2 billion euros ($20.05 billion) to support the bank during the 2008 financial crisis. its status. The authority, which retains a 12% stake, said last week that it had repaid about 13.15 billion euros in rescue funds so far.
All eyes are now on whether UniCredit will make that leap now that the German government has dumped shares on the market again.
“It is possible that the government will reduce its holdings further. We will be interested if the conditions are right,” Oser said on Thursday. “It’s possible we could buy on the open market. Or we could potentially do nothing. But we don’t have that flexibility unless we request authorization first.”
The Italian bank already operates in Germany through its Munich-based bank HypoVereinsbank. Analysts at Berenberg stressed in a note on Thursday that the Commerzbank acquisition would fit in with Orcel’s broader expansion strategy and create Germany’s second-largest bank, with a market share of about 8% of customer loans.
“UniCredit has always seen itself as a pan-European bank and its CEO wants to keep it that way,” they said. “So expanding operations in countries where it already has a presence is consistent with that objective.”
UniCredit made a similar cross-border move last year, buying nearly 9% of Alfa Bank from the state-owned Hellenic Financial Stability Fund, although it has yet to take further action against the Greek lender.
Until recently, Germany’s largest lender Deutsche Bank Deutsche Bank was seen as a leading contender to acquire Commerzbank after preliminary talks suddenly collapsed in 2019. .
UniCredit’s takeover of Commerzbank would be a rare and long-awaited example of consolidation among Europe’s banking giants. This resource-intensive and time-consuming process is often hampered by regulatory hurdles and restrictions on large exposures.
However, David Benamou of Axiom Alternative Investments said Orcel was taking a stake in Commerzbank at “probably one of the best moments he could have”.
“It’s a great move from a financial perspective,” Benamou told CNBC’s Steve Sedgwick on Thursday.
He noted that the stock gains come as Commerzbank has yet to confirm its August share buyback plan with the European Central Bank, involving the first tranche of 600 million euros, or about 3.3% of its market capitalization as of Thursday, which means The plan was not approved.
Analysts at Berenberg added that a potential takeover of Commerzbank would “significantly” reduce the likelihood that UniCredit would seek domestic consolidation in Italy – which in 2021 exited a tie-up with Monte, the world’s oldest bank. Negotiations of dei Paschi.
Furthermore, “UniCredit will have to deal with potential political and union opposition to the deal, which could limit the value extraction from the acquisition. Finally, since the combined entity will be a larger and more complex bank, it There may be more pressure.
According to Reuters, Commerzbank is already seeking to block a potential takeover, while Frank Werneke, the head of Verdi, one of Germany’s largest unions, has called on the German government to retain its stake in the bank “until otherwise.” Notice to avoid acquisition,” according to the statement via Google Translate.
— CNBC’s Ganesh Rao contributed to this report.
