Deutsche Bank came under increased pressure today to move forward with a tie-up with Commerzbank after a report that Italy's Unicredit is preparing a rival bid for the German lender.
UniCredit is preparing a rival multi-billion-euro bid to take control of Commerzbank as Deutsche Bank faces troubles with its move to buy its rival German lender, the Financial Times reported today.
UniCredit, Commerzbank and Deutsche Bank all declined to comment on the report.
Deutsche and Commerzbank announced talks on March 17, and two people with knowledge of the talks said today that talks were proceeding well and "very carefully".
Berlin has wanted to prevent a foreign takeover of Commerzbank, sources have said.
But a potential merger between Germany's two largest banks has met stiff resistance from labour unions fearing jobs cuts, and some major investors who question the logic of a merger.
Deutsche and Commerzbank have been divided over the pace of their merger talks, two people with knowledge of the matter said this week.
Commerzbank would like to see a speedy decision on whether to deepen the discussions or not, while Deutsche Bank needs more time.
Jefferies said in an analyst note that nothing could be ruled out, but there was a lower probability of a Unicredit tie-up "given execution risks attached and unfavourable regulatory backdrop" of cross-boarder mergers.
The Italian lender plans to buy a sizeable stake in Commerzbank and merge it with HypoVereinsbank, the German lender it already owns, the Financial Times said, citing people familiar with the matter.
The combined entity would be based in Germany while UniCredit would maintain its headquarters and listing in Milan, the report said.
Reuters had reported in 2017 that UniCredit had told Berlin it was interested in eventually merging with Commerzbank, with the bank later denying having an interest in the German lender.
The FT reported that one of the parties might decide to walk away from the talks, adding a significant announcement could be made as early as this weekend, citing people briefed on the discussions.