Commerzbank's Control Threshold Narrows as Berlin Weighs Selling Its Remaining Stake

UniCredit's effective stake in Commerzbank rises to 49.65% after share cancellation; Berlin open to selling remaining stake, talks advance.

The arithmetic of ownership at Commerzbank has shifted once more. Following the cancellation of its own repurchased shares on Thursday, UniCredit's effective economic exposure to the Frankfurt-based lender now stands at 49.65 percent, with 3.36 percent of that position hedged through call options. The Italian banking group, led by Andrea Orcel, is now within striking distance of a controlling majority — a development that is concentrating minds in Berlin and in the Commerzbank boardroom alike.

The share cancellation, disclosed through a mandatory notification under Section 41 of the German Securities Trading Act, reduces the total number of voting rights to 1,080,847,095. It is a technical adjustment, but one with strategic consequences: as Commerzbank retires its own stock, UniCredit's relative weight within the shareholder register grows automatically.

Berlin's Stance Softens

The political landscape is shifting in parallel. According to Bloomberg, German government circles are now openly discussing the sale of the federal government's remaining 12.7 percent stake to UniCredit — a marked departure from earlier resistance to what was once viewed as a hostile takeover. The state still holds roughly 13 percent, and its apparent willingness to entertain an orderly exit is being read by many observers as a signal that the final phase of the takeover is underway.

That reading is reinforced by the first formal talks between Commerzbank CEO Bettina Orlopp and Orcel, which took place in August. Euronews reports that the agenda covered control structures, balance sheet matters, legal issues and risk management — the substantive building blocks of any future merged entity. The timing was no accident: Reuters had already reported, citing an internal European Central Bank document, that the regulator was inclined to approve the transaction. With the "whether" seemingly settled, the conversation has moved to the "how."

The economic stakes are considerable. UniCredit is targeting cost savings of 1.3 billion euros by 2029/2030 to make the combination profitable, according to Reuters — a figure that underscores why the current discussions go well beyond formalities and into decisions that will affect business lines and jobs.

A Legal Echo From 2008

The takeover narrative is not the only headline touching the bank. Frankfurt's public prosecutor's office has brought charges against four former Commerzbank employees — two Britons, a German and an American — in connection with Cum-Ex dividend-stripping transactions dating back to 2008. The alleged tax damage is put at more than 20 million euros.

For the current institution, the case carries largely symbolic weight, touching as it does on historical practices unrelated to today's business. Yet reputational exposure is hard to rule out entirely, particularly at a moment when the bank is already under an unusually bright spotlight.

Market Takes It in Stride

The share price response has been notably subdued given the volume of news. On Friday, the stock closed at 39.08 euros, up 1.6 percent on the day. Over the past week, however, the shares have slipped 1.8 percent, easing back from the record levels touched a fortnight ago. The gap to the 52-week high of 40.11 euros, reached on August 13, stands at 2.6 percent, while the distance to the year's low of 28.90 euros remains a substantial 35 percent.

The market's composure likely reflects the financial underpinning beneath the takeover talks. Commerzbank's first-half results, published roughly two weeks ago, showed a record net profit of 1.81 billion euros, alongside a share buyback program of up to 1.2 billion euros. Combined with dividends, total capital return for the current fiscal year is projected at around 3.2 billion euros.

Analysts had already begun pricing in the integration story over the summer. In July, J.P. Morgan's Delphine Lee raised her price target on UniCredit from 93 to 94 euros, explicitly citing the positive effects of the Commerzbank consolidation. The DZ Bank followed in early August, lifting its fair value for Commerzbank shares from 42 to 46 euros and reaffirming a "Buy" rating, with analyst Philipp Häßler treating the UniCredit takeover as his base case.

Investors now have two dates on the calendar: Commerzbank's appearance at the Bank of America 31st Annual Financials CEO Conference in September, and third-quarter figures due on November 4. Both should offer further clarity on how far the ownership transition has progressed — and how quickly the pieces of a merged bank might fall into place.