In brief
The ECB cleared UniCredit to exceed a 30% stake in Commerzbank and to keep increasing its holding with no upper limit, announced on Thursday, 15 October.
Remaining regulatory steps and offer conditions are expected toward the end of the year, when UniCredit would hold about 50% of voting rights and be able to take control.
The federal government holds just over 13% and wants to prevent operational redundancies among roughly 40,000 full-time equivalent staff, while keeping Commerzbank listed in Frankfurt.
ECB clears the way above 30%
UniCredit announced on Thursday, 15 October, that the European Central Bank had authorized it to go beyond a 30% holding in Commerzbank and keep increasing its stake with no ceiling. The approval comes from the ECB's banking supervision arm, which oversees the largest banks in the euro area. Italian news agency ANSA and Il Sole 24 ORE carried the bank's note, and Focus reported the same announcement. According to Focus, the decision allows UniCredit to convert Commerzbank shares it secured through an exchange offer in the summer into its own holdings. Focus also notes that the ECB has repeatedly backed cross-border bank mergers in the eurozone to strengthen the EU single market, so the approval was not a surprise.
What still has to happen
The remaining regulatory steps and the conditions needed to finalize the offer for Commerzbank are expected toward the end of the year. At that point UniCredit would hold about 50% of Commerzbank's voting rights and be in a position to take control of the bank. Focus reports that UniCredit can now buy further Commerzbank shares on the open market, and could also launch another offer, although that would be expensive because of the customary takeover premium.
- ECB approval threshold UniCredit may now exceed
- 30 %
- Expected UniCredit voting rights at completion
- 50 %
- Federal government stake (just over 13%)
- 13 %
Data from the article text
The chart sets the 30% threshold that UniCredit has now been cleared to exceed against the roughly 50% of voting rights expected at completion and the federal government's just over 13% stake.
Berlin's demands
The German federal government holds just over 13% of Commerzbank and therefore has a say in the outcome, according to Focus. It wants to prevent operational redundancies at the DAX-listed group, which has roughly 40,000 full-time equivalent employees worldwide. The government also wants Commerzbank to remain a listed stock corporation headquartered in Frankfurt. It further aims to keep the bank's strong lending business with small and mid-sized companies, known as the Mittelstand, going.
UniCredit's view of the decision
UniCredit's statement describes the approval as an important milestone in its takeover of Commerzbank. The bank says the decision underlines the ECB's positive assessment of the transaction. It also cites confidence in the solid fundamentals and strong position of UniCredit within the European banking sector, according to the statement as carried by Focus. Il Sole 24 ORE reports the same note, describing the step as a fundamental milestone in the acquisition. The group led by Andrea Orcel will reach about 50% of voting rights once the final steps are completed, the paper says.