Commerzbank: Berlin puts brakes on recent speculation

(CercleFinance.com) - On Friday, the German government dampened speculation surrounding a possible takeover of Commerzbank by UniCredit by confirming its intention not to sell any more shares.


In a brief statement, the German Finance Agency (Deutsche Finanzagentur) states that it has no plans to sell any further shares following its recent share sales on 10 and 11 September.

Commerzbank is a stable and profitable institution, the agency says. The bank's strategy is geared towards independence, the agency adds.

The Federal Government will support it until further notice by maintaining its shareholding, it adds.

At around 11:45 a.m., Commerzbank shares were down more than 2% on Monday on the Frankfurt Stock Exchange, posting the biggest drop on the DAX index.

Buoyed by the sale of a 9% stake by the German state to Italian banking giant UniCredit, the stock had soared by 25% over the past ten days, triggering a wave of speculation about a possible takeover bid.

RBC analysts still rate the probability of a UniCredit bid at 50%, but believe that the transaction could take longer than expected to materialise.

This should not prevent UniCredit from approaching Commerzbank with a view to a tie-up, but the latest comments from its CEO suggest that UniCredit is in a position to wait before increasing or reducing its stake, the Canadian broker says.

In view of the German Finance Agency's press release, we do not expect UniCredit to launch an offer immediately, it adds.

This does not mean that an offer should be ruled out, but any transaction is likely to take longer to finalise, it concludes.


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