Tilting at windmills
The official line in Germany is still that Commerzbank should retain its independence. Supervisory Board Chairman Jens Weidmann, Finance Minister Jörg Kukies, and Commerzbank Board Member Michael Kotzbauer have all recently explained in their own words why a takeover of Commerzbank by Unicredit does not appear to make sense. But how likely is it that this can still be averted?
While other topics have long since moved into focus here in Germany, ahead of the parliamentary elections and the inauguration of US President Donald Trump, the Italians appear to be preparing to move quickly if the ECB gives the green light.
Last week Barclays made a mandatory announcement that it holds 7.72% of Commerzbank shares directly, and has built up an 8.33% derivatives position. The bank said that it is not pursuing any of its own strategic goals.
However if UniCredit were eventually to get access to this stake, it would have already secured a potential 44%. And with the almost 6% over which Citigroup has control, a package of more than half of Germany's second-largest private commercial bank would have been assembled.
Orcel unperturbed
Unicredit CEO Andrea Orcel seems to be unperturbed by all the criticism in recent months. Why should he wait until a new government coalition has been formed in Berlin, and can organise renewed resistance to the Italian advances?
Commerzbank can also expect little support from the other shareholders. Blackrock holds just under 7%, mostly directly. According to an older voting rights notification, Bank of America also holds just under 7%.
Commerzbank CEO Bettina Orlopp's increasingly hopeless defensive battle could come to an end even before the planned Capital Markets Day on 13 February.
Why does Orcel have the confidence to pursue a hostile takeover despite the historically rather modest prospects of success? He may be speculating that Capital Markets Union in Europe could soon make unexpected progress under the increasing deregulatory pressure from the USA under Donald Trump. That would be a bold bet. However, from a current perspective, it is probably less risky than betting on Commerzbank remaining independent. Its defence battle increasingly looks like tilting against windmills, with Bettina Orlopp in the role of Don Quixote.
