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UniCredit chief executive Andrea Orcel has intensified his pursuit of rival Commerzbank, unveiling a new business plan for the German lender that he said has “consistently underperformed” under its current strategy.
The plan unveiled on Monday would lift Commerzbank’s net income to about €5.1bn in 2028 — well above its current projections. The lender “risks becoming increasingly unfit for a banking environment that is changing rapidly”, Orcel told a conference call.
UniCredit is already Commerzbank’s largest single shareholder after building a stake in 2024. It has struggled to push through a full takeover amid opposition from the German government, underscoring the political difficulties of pursuing cross-border bank mergers in Europe.
UniCredit last month tabled a €35bn full takeover offer effective from May 5. However, Commerzbank chief executive Bettina Orlopp said in an interview last week that she would stick to her standalone strategy for the lender.
Orcel said UniCredit could consider a “revision” of its offer after discussions with Commerzbank. The German lender said the two groups had held talks but it had rejected the Italian bank’s approach, arguing that a deal did not offer sufficient upside for investors.
According to the UniCredit chief, the German lender should focus on its home market of Germany and Poland and scale back its “fragmented and inefficient” international operations.
“Germany and Europe need a stronger and more competitive institution better equipped to compete,” Orcel said.
Last week the European Commission signalled that it intended to relax the bloc’s merger rules to support cross-border transactions. UniCredit’s bid for Commerzbank, however, illustrates the obstacles faced by European dealmakers, despite Mario Draghi’s call for the creation of larger regional champions.
UniCredit already owns Germany’s HypoVereinsbank, which it acquired in 2005. While HVB is strongest in Bavaria and other parts of southern Germany, Commerzbank has a broader footprint in the west and north, particularly among the Mittelstand companies that form the backbone of its corporate client base.
“This is an in-market merger of two complementary banks that have tried to come together for 25 years,” Orcel said. “And outside of Germany our pan-European group achieves cost synergies well above what can be achieved domestically.”
Commerzbank shares rose 1.2 per cent in early trading in Frankfurt, while UniCredit dipped 1.8 per cent in Milan.
