UniCredit’s surprise stake in Commerzbank dims friendly merger hopes- report

Investing.com — The chances of a friendly merger between Commerzbank (ETR:) and UniCredit seem slim, following the Italian bank’s unexpected acquisition of a substantial stake in the German lender.

This was stated by Jens Weidmann, the chairman of Commerzbank’s supervisory board, in an interview published in Handelsblatt on Monday.

Weidmann expressed skepticism about the potential for creating lasting value through a hostile takeover in the banking sector. He emphasized the importance of management engaging in trust-based discussions and developing a shared understanding during mergers.

According to Weidmann, UniCredit bypassed this approach, surprising them with its entry, which he deemed as inappropriate.

UniCredit currently holds approximately 28% of Commerzbank’s shares. The Italian bank directly owns about 9.5% and has secured access to an additional 18.5% via financial instruments.

Weidmann suggested that for the sake of Germany’s financial sovereignty, it would be beneficial to have two large independent private banks, Deutsche Bank (ETR:) and Commerzbank.

He pointed to the examples of HypoVereinsbank and Bank Austria, which were acquired by UniCredit in 2005, as illustrations of how banks can evolve after losing their independence.

Weidmann expressed concerns that Commerzbank’s presence in Germany could diminish and Frankfurt’s appeal as a financial hub could be impacted if the bank lost its independence.

He added that such a development could force many clients, particularly from the small and medium-sized enterprise sector, to reconsider their banking relationships.

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