Commerzbank shares jump as Italy's UniCredit builds a 9% stake

By Steve Goldstein

UniCredit builds stake in Commerzbank after German government reduces holding

Commerzbank shares surged on Wednesday after Italy's biggest bank UniCredit bought a minority stake, triggering speculation a full merger could occur.

Commerzbank shares (XE:CBK) jumped 18% to EUR14.88. UniCredit (IT:UCG) shares fell 1%.88

UniCredit said it's taken a 9% stake, by buying a 4.5% chunk of Commerzbank held by the German government and the rest through market activity. The German government said it sold its shares at EUR13.20, a premium to its closing price of EUR12.60 on Tuesday.

Reports from Germany indicate it was surprised by UniCredit's aggressive stake purchase.

Germany still has a 12% holding in Commerzbank, left over from the 2008 financial crisis.

UniCredit said it will now "engage with Commerzbank to explore value creating opportunities for all stakeholders in both banks." Any further stake buying will depend on "meeting UniCredit's strict financial parameters," the Italian bank said.

UniCredit two decades ago bought HypoVereinsbank, and Germany accounted for about a fifth of its EUR12.58 billion in revenue during the first half of the year.

Commerzbank said the stake purchase is "testament to the progress made and the position of Commerzbank. Commerzbank's management and supervisory board will continue to act in the best interest of all our shareholders and our key stakeholders such as employees and clients."

Commerzbank has held periodic talks over the years to merge with larger rival Deutsche Bank (XE:DBK). CEO Manfred Knof said on Tuesday he would not seek a new term when his contract ends at the conclusion of 2025.

-Steve Goldstein

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09-11-24 0842ET

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