DUESSELDORF/FRANKFURT: Germany’s antitrust authorities on Monday approved UniCredit’s plans to own just under 30% of Commerzbank, removing a further obstacle to the Italian lender’s ambition to take over its German competitor.
The decision by the Federal Cartel Office was expected and follows a similar green light by the European Central Bank earlier this year. It allows UniCredit to raise its stake in Commerzbank from its current holding of around 9.5%.
This could eventually clear the way to UniCredit’s bold attempt at cross-border banking consolidation in Europe, following a months-long winding path.
Big hurdles remain, however, with Commerzbank management, unions and the German government - which is the lender’s biggest shareholder with a stake of around 12% - opposed to a takeover.
UniCredit disclosed last year that it had built a web of financial transactions through derivatives to secure a Commerzbank stake of around 28%, pending the regulatory approval, and that it ultimately desired a 29.9% stake.
“UniCredit may acquire 29.99% of Commerzbank,” the cartel office said.
Commerzbank, which has been working to maintain its independence, said that the approval does not change the fundamental situation of UniCredit being a shareholder.
UniCredit said it was focused on its strategy and that Commerzbank remained an investment. “UniCredit has secured optionality,” it said.
The question now is if and when the Italian bank will act to convert the derivatives into additional shares that would put it on the cusp of a full-blown takeover of one of the most important lenders to Germany’s small and medium-sized companies.
The German regulators had the option of opening a more detailed probe, which would take a further four months, if they believed UniCredit’s stake buildup would skew competition.
The cartel office said it gave the approval after studying the impact on companies and other competing banks, including Deutsche Bank and DZ Bank.
If UniCredit were to go ahead with a full takeover of Commerzbank, it would need to clear more regulatory hurdles, including from the European Commission and European Central Bank.
Andrea Orcel, UniCredit CEO, shocked Germany’s corporate and political establishment last year when the Italian bank snapped up a hefty stake in Commerzbank and began pushing for a tie-up in a bold attempt at a pan-European bank merger.
UniCredit’s pursuit of Commerzbank has become a test of Germany’s resolve to fend off foreign suitors and prevent its financial centre in Frankfurt from losing one of its few remaining big commercial banks.
Orcel has said he would wait until a new government was in place in Berlin after a recent election before acting further. He has also recently said he may need to wait until 2027 to make a decision on what to do.
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