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(Bloomberg) — The German Finance Ministry is sticking to a plan to sell off its entire stake in Commerzbank AG despite UniCredit SpA’s move to buy all the shares offered last week, according to people familiar with the matter.
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While the finance ministry oversees Germany’s stake in Commerzbank, a decision on further sales needs the unanimous approval from a committee that also has officials from various other government bodies including Chancellor Olaf Scholz’s office. It’s not clear if the chancellery shares the finance ministry’s view on further Commerzbank share sales.
Germany’s ruling coalition has previously agreed to divest from Commerzbank completely and that continues to be the finance ministry’s intention for now, the people familiar with the matter said. The aim is to sell at the best possible price rather than holding on to the stake, even if that means UniCredit may end up buying more shares, they said, asking not to be named discussing the private considerations.
“The Federal Government will thoroughly analyze the situation that has arisen and make decisions on how to proceed in due course,” a representative for the finance ministry said.
UniCredit Chief Executive Officer Andrea Orcel last week took Germany by surprise when he swooped in to build a 9% stake in Commerzbank, turning the Italian bank into the second-largest shareholder overnight. Orcel seized on Germany’s first sale of shares in Commerzbank AG since the country acquired them through a bailout over a decade ago, subsequently saying he’s considering a full takeover of the German bank.
Berlin hadn’t expected that a strategic investor would buy the full share package it sold last week, Bloomberg has reported. The influential labor union Verdi has since put pressure on the administration to halt further share sales and prevent an acquisition of Commerzbank by UniCredit as it’s concerned about job cuts in the wake of a potential deal.
The German Finance Ministry is run by Christian Lindner who is a member of a political party known as FDP that opposes a strong role of the government in the economy. However, Scholz is a member of a rival party called SPD, which views state intervention much more favorably.
The German government committed to a restriction on selling any further Commerzbank shares for a period of 90 days when it announced the sale to UniCredit. It still owns 12% in Commerzbank and continues to be its biggest shareholder.
–With assistance from Michael Nienaber and Iain Rogers.
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