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Germany’s powerful services sector union would fight any tie-up of Commerzbank with larger Italian rival UniCredit “tooth and nail” along with employee representatives, a supervisory board member told the Financial Times.
“We will oppose a potential tie-up in all decision making bodies and, if necessary, will also organise public protests,” said Stefan Wittmann, a senior Verdi official and Commerzbank supervisory board member.
Under German co-determination rules, workers’ representatives hold half of the seats on the supervisory boards of large listed companies — a body that needs to vote on all major strategic decisions — although the chair Jens Weidmann can over-rule union opposition in case of deadlock.
UniCredit disclosed on Wednesday that it built a 9 per cent stake in its German rival and was preparing the legal steps necessary to increase its stake further. Commerzbank is open to talks with its new shareholder, people familiar with internal discussions told the FT. Shares in the German lender have jumped 18 per cent.
Verdi boss Frank Werneke called on the German government to immediately cease any further sale of Commerzbank shares.
“Finance minister Christian Lindner needs to issue a clear sign of support for Germany as a business location and needs to block a potential takeover of Commerzbank by UniCredit,” Werneke said in a statement.
Commerzbank supervisory board member Wittmann argued that UniCredit was not a good owner for Commerzbank as the German lender was a key provider of funding for Germany’s all-important export industry as well as the country’s small and medium-sized companies, which are seen as the backbone of the country’s economy.
“You cannot hand this over to Milano,” he said, adding that UniCredit’s treatment of its German subsidiary HypoVereinsbank had set a bad precedent.
Earlier this year, UniCredit changed HVB’s legal structure, in a move that shifted much of the decision making power over the German operations to Italy.
The Italian lender also cut substantial numbers of jobs and branches in Germany in what Wittmann characterised as “an unprecedented cull”. “As this pattern is likely to be a blueprint for UniCredit’s potential takeover of Commerzbank, this is one key reason why we will fight such a transaction tooth and nail,” he said.
The union official, who has been a member of Commerzbank’s supervisory board since 2018, also lashed out against the German government’s handling of the selldown of its stake.
“The finance ministry has been sleepwalking into the biggest banking consolidation in at least a generation,” said Wittmann, adding that Berlin’s decision to sell the 4.5 per cent stake to UniCredit was “utterly naive”.
The finance ministry said earlier on Wednesday that it was “bound by the principle of economic efficiency” and had “allocated [the shares] to the — by far — highest bidder”, at a premium to Tuesday’s closing price. The sale secured €702mn.
Verdi was not against a reduction of the government’s stake, Wittmann said, as the selldown highlighted Commerzbank’s new strength. “But the federal government, of course, also has the obligation to take a look at who is buying the shares,” he said.
“The German economy is going through very difficult times already, and then you put parts of Germany’s Mittelstand under additional pressure by putting one of their most important sources of funding on the line,” Wittmann said. “We will remind the government of its responsibilities.”
UniCredit and the German finance ministry declined to comment.
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