Two worlds facing each other, two different perceptions of business, two different visions of the future. The planned ops of Unicredit on Commerzbank represents much more than a financial transactionThe institute led by Andrew Orcel, of information letter to shareholders in sight for theMay 4th meeting called to deliberate thecapital increase functional to the offer, paints a difficult situation in the German area, where it seems that there is no desire to grasp the importance of creating a European hub, with the German bank entrenched in its fortress, without even wanting to pool data which would be necessary to ground the operation.
Unicredit, which holds almost 30% of Commerzbank, last month presented atakeover bid entirely in shares for the rival, worth almost 35 billion of euros. At the time, the company said the offering would likely bring its stake to just above 30%, as the low premium would limit take-up.
In the letter to shareholders Unicredit described theops as the "result of the prior refusal by Commerzbank to engage in a any of the proposed alternatives or to respond to the concerns and suggestions of the issuer (i.e. Unicredit itself, ed) aimed at prepare better for the future and create further value, as well as its continued adverse actions that impact the issuer's position.”
The Milanese institute claims to have maintained, since entering the capital of Commerz, a line oriented towards cooperation, reiterating "its own and security to evaluate possible forms of cooperation with the German bank, making available theits expertise and its pan-European network to collaborate with Commerz to foster its growth,” the document underlines.
On the other side, the attitude was the opposite. "Frankfurt did not follow through on this offer, potential value-creating initiatives were not implemented, and therefore a formal takeover bid was launched."
Obstructionism also in sharing information
Unicredit also reported that "to date, the issuer access to documents was not granted relating to the voluntary public offering, nor has it been able to benefit from a constructive dialogue with Commerzbank to assess the full value creation potential”. absence of a data room and a technical comparison, Orcel's bank had to rely exclusively on "public domain data" and that "it did not carry out any due diligence".
In the intentions of Piazza Gae Aulenti, theops it should be the tool to overcome the impasse on the dossier. However, it remains uncertain Whether this step will be sufficient to rekindle discussions is uncertain. "It is uncertain whether Commerz and UniCredit will engage in constructive strategic dialogue regarding a possible merger or other forms of meaningful cooperation, nor whether they will be able to reach agreement on a common path forward."
Moreover, says Unicredit, "the decision to integrate Commerzbank could have negative repercussions on relationships with customers, suppliers and other business partners; a particularly high risk in cases where Commerzbank's business partners are direct competitors of UniCredit or customers are satisfied with Commerzbank's independence or its specific market positioning,” the document reads.
Commerzbank reiterates its willingness to go it alone
Last Tuesday, the German bank publicly reiterated its opposition to the takeover bid: it said that UniCredit did not offer its shareholders "sufficient value growth potential compared to the autonomous strategy," adding that the Italian bank was not willing to "offer Commerzbank shareholders an adequate and necessary premium." According to Commerz, the elements of the transaction verbally explained by UniCredit do not demonstrate sufficient value creation potential for its shareholders within the relevant planning horizon. The institution led by Bettina Orlopp also stated that it will continue to focus on executing its autonomous strategy.
