UniCredit now holds 21% of Commerzbank’s capital and aims for 29.9%

ROME/MILAN (Reuters) – UniCredit said on Monday it had acquired an additional 11.5 percent of Commerzbank through financial instruments after asking supervisory authorities to hold up to 29.9 percent of the German bank.

“The physical settlement of the new financial instruments can only take place after obtaining the required approvals,” UniCredit wrote in a note.

Taking into account the 9% stake that UniCredit already held in its German rival, the Italian bank’s overall position now stands at around 21%, it said.

Italy’s second-largest bank added that it had covered “the majority of UniCredit’s economic exposure” to Commerzbank in order to be free “either to maintain its stake, or to sell its stake with a capped downside risk, or to further increase its stake.”

A possible decision “will depend on the outcome of the engagement with Commerzbank, its management and supervisory board as well as the broader stakeholders in Germany,” the Italian bank also said.

Unicredit’s interest in Commerzbank took Berlin by surprise and sparked opposition from unions.

On Friday, the German Financial Agency said the German state would not sell any more Commerzbank shares for the time being because the bank’s strategy was “oriented towards independence.” Berlin retains a 12 percent stake in Commerzbank.

On the sidelines of the United Nations General Assembly in New York, German Chancellor Olaf Scholz spoke on the subject on Monday, declaring that any attempt to take a stake in Commerzbank without prior consultation with the state would be inappropriate, in Germany and in Europe.

“Hostile takeovers are not a good thing for banks, and that is why the German government has taken a clear position on this,” he added.

The German Finance Ministry has communicated its displeasure to UniCredit, a representative said.

In Italy, however, Unicredit’s appetite is well received.

Italian Foreign Minister Antonio Tajani on Monday called it “more than legitimate” for an Italian company to try to buy part of a German competitor.

“This is about the internal market, being pro-European only in words leaves something to be desired,” he said, believing that Unicredit “did the right thing” to act within the European Union market.

When contacted, Commerzbank declined to comment on UniCredit’s increased stake.

(Reporting by Valentina Za; with contributions from Tom Sims in Frankfurt; French version by Claude Chendjou, Mara Vîlcu and Pauline Foret; editing by Kate Entringer and Blandine Hénault)