Commerzbank takeover? UniCredit denies… not really!

The rumor mill about Commerzbank is slowly boiling over. Since the strong hand of a “Deutschland Bank” consisting of CoBa and DB no longer exists as a scenario Commerzbank is a bird free object of desire. Numerous candidates from the Netherlands, France and Italy could be possible buyers for CoBa.

Commerzbank an easy victim

Lastly we had discussed ING as a possible buyer. After all with a market value of 44 billion euros a “merger” by exchange of shares would be a simple number for the Dutch with a Commerzbank value of only 10 billion euros. But yesterday afternoon the news came on the table that the Italian UniCredit which had already acquired one of the former four large German banks HypoVereinsbank in 200, had given banks a mandate to plan the takeover of Coba. Over the past 14 years Hypo has been “digested” by UniCredit in its entirety.

If UniCredit now also buys Commerzbank then three (!) of four former major German banks would have disappeared under the umbrella of the Italians (Hypo, CoBa, Dresdner). UniCredit allegedly commissioned advisory banks with a mandate to prepare the takeover of Commerzbank. UniCredit is now reacting to this report with a “denial”, if you can call it that way. Original wording:

At the request of the Italian market Autorithies, further to an article published by Reuters today 14 May 2019, and the ensuing media speculations, UniCredit would like to clarify that no banking mandate has been signed related to any potential rumoured market operation. UniCredit would like to reiterate it is fully focused on the successful conclusion of its Transform 2019 plan, based on organic assumptions, which is well on track to achieve all stated objectives, as confirmed at the Group’s Q1 2019 results on 9 May 2019. As previously announced, in addition to the four financial measures unveiled on 7 May 2019, the Group will present its new business strategy at an investor day to be held in London on 3 December 2019.

Denial sounds different

The decisive words are marked in bold. This “denial” by UniCredit merely denies that no bank has been given a mandate for an action. However, no mention was made of the fact that there was no interest in Commerzbank. A lack of interest in a takeover sounds different! So you can speculate that UniCredit is interested in swallowing Commerzbank.

UniCredit “only” has a market capitalization of 24 billion euros. In the case of a merger by exchange of shares UniCredit would still be clearly overrepresented with its shareholders and the management level of Commerzbank would probably no longer be able to be maintained in a merged bank. So CoBa would ultimately go down (be degraded) just like Hypo. So the German branc, as a Cash Cow which is supposed to deliver surpluses to Milan every year. For this CoBa would of course have to be heavily trimmed for profit (layoffs, branch closures, etc.)!

The Commerzbank share already rose yesterday from 7.32 to 7.72 euros. Will it tend weaker today in the course of the day? Well… with the spongy, half-cooked denial the rumour kitchen is more likely to be fueled than boiled down!


Foto: Epizentrum – Opera propria CC BY-SA 3.0

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