Commerzbank’s chief, Bettina Orlopp, has declined an invitation from UniCredit’s CEO, Andrea Orcel, to have informal discussions about a possible merger. Instead, she has requested a formal written proposal before considering any further engagement, as reported by sources familiar with the matter.
Orcel had previously met with Orlopp in November during a JPMorgan Chase conference in London, where he outlined his vision for a larger banking entity. This included discussions on potential workforce reductions, the company’s headquarters location, branding strategies, and a commitment to supporting small and medium-sized enterprises—commonly known as Mittelstand.
Orcel proposed that the two CEOs hold another meeting with a select group of staff at a discreet location over a weekend to better address pressing issues and identify each side’s non-negotiables and areas for potential compromise. However, Orlopp rejected this idea, asserting that a written proposal was necessary to evaluate the benefits of such a meeting.
Both Commerzbank and UniCredit have refrained from commenting on the interactions between Orcel and Orlopp. The German bank, however, indicated it has shown openness to discuss collaboration but emphasized the need for a detailed proposal regarding the economic and structural aspects of any potential transaction, which has yet to be received.
Last year, Commerzbank’s investors urged management to engage with UniCredit, which has accumulated a 28 percent stake in its German rival since September. Commerzbank stated that it has held investor discussions concerning its operational performance and strategic goals, without addressing any possible transactions.
The German bank described UniCredit’s approach of expanding its stake as “hostile,” suggesting that it has created unnecessary tensions with various stakeholders. Insiders from UniCredit have indicated that the bank is cautious about submitting written terms before discussions begin, due to concerns over possible leaks that could jeopardize negotiations.
Criticism regarding a potential merger has emerged from the German government, Commerzbank’s management, and its workers’ council, with particular focus on fears of job losses and the impact on lending to small and medium enterprises.
Recent political developments, including snap elections in Germany scheduled for next month, may delay UniCredit’s ambitions to pursue Commerzbank further, as any significant efforts will likely hinge on the formation of a new government.
Without backing from the German government, Orcel has remarked that reaching an agreement would be challenging. UniCredit maintained its position as an investor in Commerzbank, expressing hope that the management would seriously consider engaging in a transparent manner regarding any potential offers. The Italian bank reiterated its readiness to meet and discuss critical issues to seek a mutually beneficial agreement for all involved stakeholders.
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