German government refuses to sell Commerzbank stake, rejects UniCredit takeover offer
Berlin is digging in against Europe's biggest bank takeover. The German government says it will keep its 12 percent stake in Commerzbank $CBK and rejects UniCredit's roughly 39 billion euro bid as short on premium. UniCredit $UCG already holds more than 39 percent. Per Reuters.
Berlin has put itself directly in the path of what would be one of Europe's largest banking takeovers. The German government said it will not sell its stake of more than 12 percent in Commerzbank $CBK and rejected UniCredit's offer, valued at roughly 39 billion euros, on the final day of the formal acceptance period. Germany's Finance Agency, which manages the holding, said the bid does not carry an appropriate premium. The stake dates back to the government's rescue of Commerzbank during the global financial crisis and now sits at more than 4.5 billion euros. UniCredit $UCG, led by Andrea Orcel, has moved faster than many expected and says it already holds more than 39 percent of Commerzbank, with room to climb toward 42.5 percent. A full takeover, including any move to delist Commerzbank or squeeze out minority holders, remains difficult while the government keeps its shares. According to reporting by Reuters and Bloomberg, officials in Berlin have weighed buying additional shares through the state development bank KfW to reach a blocking position, a step that would require substantial new capital. The government said it would continue to act in the interests of Commerzbank employees, German mid-sized businesses, and the Frankfurt financial center.