Caught cold by UniCredit’s swoop on Commerzbank, Germany will want to avoid a national embarrassment
Italy's UniCredit appears to have caught German authorities off guard with a potential multibillion-euro merger of Frankfurt-based Commerzbank, a move that has triggered a fiery response from Berlin.
Market observers told CNBC that the swoop may have provoked a sense of national embarrassment among Germany's government, which firmly opposes the move, while it's been argued that the outcome of the takeover attempt could even put the meaning of the European project at stake.
Milan-based UniCredit announced on Monday that it had increased its stake in Commerzbank to around 21% and submitted a request to boost that holding to up to 29.9%. It follows UniCredit's move to take a 9% stake in Commerzbank earlier this month.
«If UniCredit can take Commerzbank and take it to their level of efficiency, there's a tremendous upside in terms of increased profitability,» Octavio Marenzi, CEO of consulting firm Opimas, told CNBC's «Squawk Box Europe» on Tuesday.
«But [German Chancellor] Olaf Scholz is not an investor. He's a politician and he's very concerned about the jobs side of things. And if you look at what UniCredit has done in terms of slimming down things in its Italian operations or particularly in its German operations, it's been quite impressive,» Marenzi said.
Scholz on Monday criticized UniCredit's decision to up the ante on Commerzbank, describing the move as an «unfriendly» and «hostile» attack, Reuters reported.
Commerzbank's Deputy Chair Uwe Tschaege, meanwhile, reportedly voiced opposition to a potential takeover by UniCredit on Tuesday. Speaking outside of the lender's headquarters in central Frankfurt, Tschaege said the message was simple and clear: «We don't want this.»
«I feel like vomiting when I hear his promises
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