 has stretched the offer of a merger with Germany's Commerzbank (CBK:ETR), in a deal which would create one of Europe's biggest banks.){kind=link}
UniCredit (BIT:UCG) has stretched the offer of a merger with Germany’s Commerzbank (CBK:ETR), in a deal which would create one of Europe’s biggest banks.
UniCredit, Italy’s biggest bank, has been looking for a European merger for some time, reportedly naming partially state-owned Commerzbank as its potential partner on Wednesday.
Neither bank have yet confirmed the offer, with a spokesperson from the German finance saying that: “officials are contacted by financial investors on a range of issues”.
“We have always said that the government does not want to keep its (Commerzbank) stake forever and wants to get a good result for the taxpayer,” he added.
Commerzbank is tempting merger material for UniCredit, currently trading at half their book value but with the potential to be worth more once interest rates rise and the bank completes its restructuring. It is currently undergoing a turnaround plan planned to last until 2019, led by Chief Executive Jean Pierre Mustier. UniCredit already operates a subsidiary in Germany, HypoVereinsbank, which has 2.6 percent share of the market.
Shares in Commerzbank’s rose more than 3 percent in Frankfurt following the Reuters report on Wednesday, whilst UniCredit’s stock dipped on the news. However, it has since recovered to trade up 2.58 percent at 17.95 (1429GMT).