By Valentina Za and Tom Sims
MILAN (Reuters) – The European Central Bank has given UniCredit approval to buy up to 29.9% of Commerzbank, the Italian bank said on Friday, adding it would likely wait until next year before deciding whether to pursue an acquisition.
ECB approval was expected given UniCredit’s strong balance sheet and the banking supervisor’s supportive stance on consolidation efforts, but it still marks a key step towards what could potentially become Europe’s biggest cross-border deal in the industry since the global financial crisis.
UniCredit’s plans for Commerzbank have sparked an angry backlash in Germany, with the Frankfurt-based lender vowing to pursue independent growth.
“UniCredit is awaiting the opportunity to initiate a constructive dialogue with the new German government once formed,” the bank said in a statement.
UniCredit CEO Andrea Orcel has repeatedly said he would consider a full takeover only if all stakeholders are supportive.
“While the approval underscores UniCredit’s financial strength and regulatory compliance, there are still many factors that will determine any further steps and their associated timeline,” the Milanese bank said.
“Our original timeline for deciding on whether to proceed or not with a potential combination is now likely to extend well beyond the end of 2025,” it added.
UniCredit’s ambitions over Commerzbank date back to 2001, even before its 2005 acquisition of Munich-based HVB.
After failed attempts by his predecessors to grow UniCredit’s German footprint, Orcel in September stunned Berlin by snapping up shares in Commerzbank, before accumulating the right to own 28% of the bank through derivatives.
UniCredit said it needed a green light from Germany’s competition authority before converting the derivatives into shares.
Commerzbank said it had taken notice of the ECB’s decision, which did not change UniCredit’s position as a mere shareholder.
“We are convinced of our strategy, which aims for profitable growth and value increase, and we are focusing on its successful implementation,” it said in a statement.
(Reporting by Valentina Za; Editing by Tommy Reggiori Wilkes, Giulia Segreti and Susan Fenton)
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