Germany rejects UniCredit’s 39 billion euro Commerzbank offer

[FRANKFURT] Germany rejected UniCredit’s takeover bid for Commerzbank and said it supports the lender’s independence, given its important role for the national economy.

On Tuesday (Jun 16), Germany’s Finance Agency, which manages the country’s stake of over 12 per cent in Commerzbank, said that accepting the offer was “not an option from a financial point of view, as it does not include an appropriate premium”.

The government backs the bank’s independence and opposes UniCredit’s “aggressive approach”, it added. 

Commerzbank “plays an important role in financing the German economy” and the jobs it provides are important to Frankfurt, where it is headquartered, the finance agency said.

“Both must continue to be ensured in the future,” it noted.

Germany has been staunchly opposed to the deal, ever since UniCredit disclosed a stake in Commerzbank almost two years ago.

The Italian lender presented a full-blown takeover offer in March that is set to close today, though it is slated to receive a two-week extension under German takeover rules.

The extension is set to run from Jun 20 to Jul 3.

The implied value of that offer has mostly been below Commerzbank’s market price, though the discount has narrowed more recently.

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Commerzbank’s market value was 39.14 billion euros (S$58.2 billion) at Monday’s close, compared with an implied bid value of about 39.06 billion euros.

UniCredit’s shares rose as much as 3 per cent in early trading on Tuesday, while those of Commerzbank dropped as much 1.1 per cent.

That lifted the offer price to around 37.2 euros a share, compared with a market price of about 35.8 euros a share. BLOOMBERG