Germany has officially rejected UniCredit’s offer for Commerzbank shares, with the country’s finance agency citing an inadequate price and concerns regarding the Italian bank’s “aggressive approach.” The rejection, announced on Tuesday, marks a significant development as UniCredit’s initial offer period for Commerzbank shares draws to a close in the months-long contest for control of the important German lender. The German government maintains a 12% stake in Commerzbank, acquired during the 2008 global financial crisis, and has consistently opposed UniCredit’s pursuit of a merger.
The finance agency stated that “accepting the offer was already not an option from a financial point of view, as it does not include an appropriate premium on the current share price of Commerzbank’s shares.” The agency, which manages the government’s holdings, also expressed strong support for Commerzbank’s independence. Commerzbank plays a critical role in financing Germany’s medium-sized “Mittelstand” companies and is an integral player in Frankfurt, the nation’s financial hub. These essential functions, the agency underscored, “must continue to be ensured in the future.”
Separately, Frankfurt prosecutors confirmed on Tuesday that a preliminary investigation into possible market manipulation related to the offer has commenced. This follows a criminal complaint lodged by Commerzbank’s workers’ council, which had communicated to staff its intention to file a complaint against unspecified persons over questions surrounding UniCredit’s acquisition of Commerzbank shares at a below-market rate. UniCredit acknowledged the matter, stating the prosecutors’ response was “in line with protocol when such complaints are filed.” In Tuesday’s trading, Commerzbank shares slipped below the price implied by UniCredit’s buyout offer, which values Commerzbank at €37.33 per share, after trading consistently above this level since the bid’s launch. The offer is set to conclude on Tuesday but will extend for an additional 15 days from June 20.
