Germany may learn to love UniCredit-Commerz

COMMERZBANK AG

29/09/2026 12:36

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
By Neil Unmack
LONDON, Sept 29 (Reuters Breakingviews) - Andrea Orcel is tightening his grip on Commerzbank CBKG.DE. The UniCredit CRDI.MI CEO may replace the board of the €46 billion lender in January, the Financial Times reported on Tuesday. A full merger between the German bank and the Italian lender's local unit may still need the backing of minority shareholders, like Berlin. But it's far from impossible.
UniCredit’s tender offer in July left it in a powerful yet awkward position. Owning a 47% stake in another large peer, but without directly determining its management or strategy, will not satisfy either the Italian bank or European regulators. Supervisors dislike situations where there is a mismatch between risk and governance. 
Orcel’s plan, as reported by the FT, is therefore to call a shareholder vote and probably oust Commerz CEO Bettina Orlopp. One wrinkle, however, is whether the German government, a 13% shareholder in Commerz, retains its two board seats, depriving UniCredit of an absolute majority.
Appointing management will allow Orcel to speed up his restructuring of the smaller lender. He is pencilling in some €1.2 billion of initial cost cuts. But simply naming the supervisory board, while owning just under half of Commerz, is still only a halfway house. To effect a full merger and take control through a so-called domination agreement, he would need 75% of shareholders at a general meeting to back him. Doing that quickly would bring forward the full benefits of the deal, which according to UniCredit could include annual savings of up to €2 billion.
One way to speed things up would be to buy out minority investors. Yet doing so within a year of the recent tender offer would force UniCredit to pay a bump to shareholders who already sold. Since Orcel has judiciously avoided paying a premium, that seems unlikely. Another variable is the German government. If it backs Orcel with its 13% stake, UniCredit could potentially reach the all-important 75% threshold without having to buy any more shares.
Why would Berlin play ball? For one, a deal could end up suiting its demands. If Commerzbank were merged into UniCredit’s German unit, the combined entity could retain a Frankfurt listing and headquarters. The government could even continue to hold a small stake to keep an eye on things. And it's not clear why Berlin's negotiating position would improve over time, meaning that it might as well extract what it can from Orcel now and then move on. 
One challenge would be finding a fair value for the unlisted UniCredit German unit, which Mediobanca analysts reckon could be worth €28 billion before factoring in excess capital and deal synergies. The same analysts estimate that a deal could leave UniCredit with 70% of the combined German entity.
There would still be other issues to iron out with the government, such as how quickly Orcel can cut costs or lay off workers, and whether he would pledge to boost lending to Germany’s Mittelstand corporate backbone. Still, coming to terms with UniCredit would offer Berlin more influence than if it lets Orcel seek control alone. Since neither side has any interest in an incomplete status quo, there's a clear deal to be done.
     
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CONTEXT NEWS
UniCredit may seek to overhaul Commerzbank’s supervisory board as soon as January, the Financial Times reported on September 29, citing people familiar with the matter. The Italian group wants to oust Commerzbank CEO Bettina Orlopp, Reuters reported on September 15.
UniCredit owns a 47% stake in Commerzbank, following a tender offer in July.

(Editing by Liam Proud; Production by Streisand Neto)
((For previous columns by the author, Reuters customers can click on UNMACK/neil.unmack@thomsonreuters.com))