UniCredit can acquire a 29.99 per cent stake in Commerbank

The Bundeskartellamt has cleared under merger control rules the acquisition of a stake in Commerzbank AG, Frankfurt am Main, by UniCredit S.p.A., Milan, Italy.

Andreas Mundt, President of the Bundeskartellamt: “The notified acquisition of a minority stake alone will strengthen UniCredit’s market position in retail and commercial banking in Germany. We therefore took a close look at the financial services that are particularly affected. There are other important competitors active in all areas, which is why the planned acquisition had to be cleared.”

Both banks offer all common banking and financial services to retail and commercial customers. UniCredit is the second largest banking group in Europe; in Germany, it is mainly active through its subsidiary UniCredit GmbH, formerly HypoVereinsbank.

The investigations focused on two levels. Regarding retail and commercial banking activities at regional level, the Bundeskartellamt examined the geographic coverage throughout Germany of the branches of the merger parties and of their main competitors, including savings banks, cooperative banks and other private banks. Even in regions where the merger will lead to market consolidation, the Bundeskartellamt did not identify any problems under merger control rules with respect to retail and commercial banking activities involving turnovers of up to 10 million euros as there will still be a large number of different providers.

The other level affected by the merger are supra-regional markets or market segments. These had to be defined, in particular, for loans made to larger SMEs and for foreign trade activities facilitated by banks where the SMEs concerned are in the import and/or export business. These services are mostly requested from domestic banks. The Bundeskartellamt requested extensive information from the parties’ main competitors, including Deutsche Bank, DZ BANK, Helaba, LBBW and BayernLB, to examine the providers active in the market and the competitive processes. The authority was also in contact with the German state investment bank KfW and with associations representing the interests of the SMEs concerned. It did not find any reliable indications that the merger would significantly impede effective competition – the criterion which has to be met to prohibit a merger. Commerzbank has a strong or even dominant position in some areas of the national markets for trade finance services such as documentary letters of credit, documentary collections and bank guarantees, where UniCredit is also active. However, various competitors also have an important position or the potential to expand their position, so that even after the merger customers will have significant alternatives to choose from.

The same is true for the segment of syndicated loans made to SMEs. Although the merger parties have quite an important position in this segment, the banks active at the supra-regional level mentioned above constitute alternatives for customers throughout Germany. When it comes to higher lending volumes, foreign banks are also active in this segment. In addition, depending on their specific financing needs, some larger SMEs also have other borrowing options, such as note loans or bonds.

The planned acquisition was to be notified to the Bundeskartellamt and not the European Commission as up to 29.99 per cent does not constitute a “controlling interest” within the meaning of the corresponding rules at European level. In Germany, however, mergers generally already have to be notified if at least 25 per cent of the shares in an undertaking are acquired or “a material competitive influence” can be exerted.