Unicredit's Takeover Troubles: Banco BPM and Commerzbank Acquisitions Hanging in the Balance
CEO of UniCredit expresses doubts about acquisition of Banco BPM - Banking head queries acquisition of Banco BPM, raising speculation and debate in the industry.
Buckle up, folks! The banking world is buzzing with drama as Unicredit's takeover plans for Banco BPM and Commerzbank hit a major roadblock. Unicredit's CEO, Andrea Orcel, has voiced his concerns, stating that if the problem can't be solved, Unicredit may withdraw from the takeover attempts.
The proposed takeover of Banco BPM is face-to-face with political opposition, both in Italy and Germany. The Italian government, initially vetoing the Banco BPM deal, used its "Golden Power" tool to protect strategic sectors. Orcel, who has also made significant investments in Commerzbank, criticized the move as opaque and excessive. But, he insisted that the bank's future looks "very bright" with or without acquisitions.
Meanwhile, Banco BPM's President Carlo Tononi responded cautiously to Orcel's comments. Should the offer fail, Tononi hinted that they might explore alternative options. In November, Unicredit announced plans to acquire Banco BPM in a roughly €10 billion share swap deal. However, Banco BPM rejected the offer, labeling it unsolicited and out of line with their own development plans.
Unicredit's pursuit of Commerzbank isn't any smoother. Both the German government and CEO Bettina Orlopp are against a takeover. Since Unicredit's stake purchase last fall, Commerzbank's share price has greatly increased, making a takeover less likely. Orcel recently confirmed that Unicredit is "far away" from making an offer for Commerzbank.
With all eyes on Unicredit, German Chancellor Friedrich Merz (CDU) penned a letter to Commerzbank's works council chief Sascha Uebel in support of the bank. The German government is pushing for a "strong and independent Commerzbank," holding around 12% of the bank's shares.
Unicredit Takeover Obstacles: A Deep Dive
- Unicredit is on the brink of abandoning its Banco BPM acquisition bid due to unyielding obstacles posed by the Italian government. The government activated "golden power" conditions, effectively blocking the deal unless specific terms are met[1].
- If these issues remain unresolved, Unicredit may abandon the acquisition bid[1][2].
- Only a tiny fraction of Banco BPM shares (0.016% as of June 2025) have been tendered, putting Unicredit at risk of a substantial financial write-off if the deal fails, which could severely impact its stock value[4].
- Commerzbank's share price has soared about 100% since 2024 due to takeover speculation, making the acquisition very expensive. Orcel described the current valuation as trading at a 30–40% premium over European peers, making a takeover "too prohibitively expensive" at this time[3][4].
- The German government opposes Unicredit's takeover ambitions. Chancellor Friedrich Merz labeled Unicredit's stake increase as "uncoordinated and unfriendly," and the Federal Cartel Office is scrutinizing potential market distortions, especially regarding credit access for small and medium-sized enterprises (SMEs)[4].
- To sum it up: | Aspect | Banco BPM | Commerzbank | |---------------------|------------------------------------|-----------------------------------------| | Current Status | Offer likely to be withdrawn | Unicredit holds 28% stake but takeover improbable | | Opposition | Italian government opposition | German government and regulators' opposition | | Unicredit CEO Comments| Attempting to meet terms but will withdraw if unresolved| Share price too high; will remain as investor| | Financial Risk | Risk of €10 billion write-off if deal collapses | Risk of overpaying for Commerzbank shares trading at 30-40% premium |
As Unicredit navigates this challenging terrain, it's looking forward to focusing on autonomous growth and managing investments strategically, whatever the outcome may be. Stay tuned for more updates on this captivating saga!
Sources:
- UniCredit overhaul may thwart BPM takeover, leaving banks up in the air
- UniCredit Banco BPM deal appears to be in trouble
- Germany pushes back against UniCredit's Commerzbank takeover
- Germany blocks Commerzbank takeover with regulatory push, likely ending Unicredit's interest
- In light of the political opposition from both Italy and Germany, the employment policies of EC countries might be affected if Unicredit's takeover of Banco BPM and Commerzbank fails, potentially leading to job losses within these banks.
- The finance ministry of the EC should consider establishing a contingency plan for the employment scenarios arising from the uncertainty surrounding Unicredit's takeover bids, in order to safeguard job security and maintain financial stability across the EC.
