BERLIN (dpa-AFX) - Italian lender UniCredit SpA (UCG, UNCFF.PK) announced Monday that it has entered into financial instruments relating to around 11.5 percent shares in Commerzbank AG (CRZBY.PK), totaling its stake in the German banking major to around 21 percent.
Meanwhile, the German government reportedly said that it would retain its 12 percent stake in the German bank for now.
Previously, UniCredit acquired an equity stake equal to around 9 percent in the share capital of Commerzbank. In this, a 4.49 percent stake was acquired from the German Government.
With the latest stake holding, UniCredit becomes the largest shareholder of Commerzbank, ahead of the German government.
Consistent with its September 11 statement, the Italian company said it has submitted the required regulatory filing for acquiring a stake in Commerzbank in excess of 10 percent up to 29.9 percent.
UniCredit now noted that physical settlement under the new financial instruments may only occur after the required approvals have been obtained.
The company noted that the majority of its economic exposure has been hedged to provide it with full flexibility and optionality to either retain its shareholding, sell its participation with a floored downside, or increase the stake further.
This will depend on the outcome of engagement with Commerzbank, its management and supervisory boards as well as its wider stakeholders in Germany.
According to UniCredit, there is substantial value that can be unlocked within Commerzbank, either stand-alone or within UniCredit, for the benefit of Germany and the bank's wider stakeholders. However, as was the case for UniCredit, such potential requires action for it to be crystalized.
The company added, 'In line with the recent EU Commission report, UniCredit shares the belief that a strong banking union within Europe is key to the continent's economic success and through it, the prosperity of each one of its nations. Ensuring growth and competitiveness within the German banking sector is critical for both the German economy and for Europe as a whole. Whilst this situation and what it could lead to requires careful consideration, the primary focus for UniCredit's management team remains on the continued execution of UniCredit Unlocked and the delivery of sustainable profitable growth and distributions for shareholders.'
In Milan, UniCredit shares were trading at 37.19 euros, down 2.12 percent.
In Germany, Commerzbank shares were trading at 15.60 euros, down 0.45 percent.
Copyright(c) 2024 RTTNews.com. All Rights Reserved
Copyright RTT News/dpa-AFX
© 2024 AFX News
