UniCredit has announced plans to increase its stake in Commerzbank above the 30% threshold, a move that signals the groundwork for a potential takeover bid under German takeover law [1]. Currently, UniCredit holds a 28% stake in Commerzbank, consisting of approximately 26.04% in shares and the remainder in total return swaps [1]. The proposed deal involves an offer exchange ratio of 0.485 UniCredit shares per Commerzbank share, which implies a price of 30.80 euros per Commerzbank share, representing a 4% premium [1].
CEO Andrea Orcel stated that he does not expect UniCredit's holding to increase significantly above 30%, emphasizing that the bid is designed to overcome the regulatory 'cliff-edge' without reaching full control [1]. Orcel also noted that taking the stake to 100% would consume 200 basis points of UniCredit's capital, and described a full takeover scenario as 'remote' [1]. The offer is expected to formally launch at the start of May, with UniCredit planning an Extraordinary General Meeting on May 4 to seek authorization for the related capital increase [1].
Commerzbank's share price has fallen more than 18% year-to-date, while UniCredit shares are down 10.5% over the same period, reflecting negative market sentiment surrounding both banks [1]. The German government remains a significant shareholder in Commerzbank with a 12.72% stake, followed by BlackRock at 5.73% and Norges Bank Investment Management at 3.14% [1].
Orcel previously told CNBC that Commerzbank's share price was too high for a merger deal, indicating that market conditions have shifted since then [1].
CONCLUSION
UniCredit's move to increase its stake in Commerzbank above 30% marks a significant step toward a potential takeover, though CEO Andrea Orcel downplays the likelihood of a full acquisition. The market has reacted negatively to both banks' shares year-to-date, and the formal offer is expected to launch in May pending shareholder approval. The event is likely to have a high impact on the European banking sector, given the regulatory and ownership implications.