Commerzbank Rejects UniCredit’s ‘Inadequate’ Bid, Unveils €5.9 Billion Profit Target and €1.10 Dividend at Pivotal AGM

The Commerzbank annual general meeting in Wiesbaden turned into a full-blown defence campaign on Wednesday as management fired back at UniCredit’s hostile takeover offer with a combination of immediate cash returns and an ambitious long?term strategy. CEO Bettina Orlopp and supervisory board chairman Jens Weidmann delivered a blunt message: the Italian lender’s all?share bid is simply not good enough.

Orlopp pointed out that the proposed exchange ratio of 0.485 UniCredit shares per Commerzbank share implies a discount of nearly €2 compared with the current market price, rather than the premium investors would normally expect. The offer was valued at roughly €34.56 per Commerzbank share, while the stock was trading at €36.67 on Wednesday – a level that represents a gain of around 42% over the past twelve months. Orlopp also cautioned that UniCredit’s synergy estimates were overly optimistic, warning that a merger could weigh on earnings by more than €1 billion.

Weidmann emphasized the balance sheet risks of combining with UniCredit. He highlighted the Italian bank’s large holdings of domestic sovereign bonds, a higher proportion of non?performing loans, and its still?significant exposure to Russia – all factors that, in his view, would leave Commerzbank shareholders worse off if they swapped their stakes.

A Record Dividend and Share Buybacks

As a tangible counterweight to the offer, the board proposed a dividend of €1.10 per share for the past financial year, a sharp increase from the €0.65 paid out a year earlier. The ex?dividend date is set for May 21, with payment expected shortly afterwards. In addition, shareholders are being asked to approve a new authorization for share buybacks of up to 10% of the company’s capital. Together with recently completed repurchase programmes, billions of euros are being returned to investors.

Should investors sell immediately? Or is it worth buying Commerzbank?

The message to Milan is clear: stay independent and keep the cash flowing.

The “Momentum 2030” Strategy

Beyond the immediate payouts, management laid out a detailed stand?alone vision dubbed “Momentum 2030”. The plan targets a net profit of €5.9 billion by the end of the decade, backed by a return on equity of 21%. The centrepiece is a major push into artificial intelligence, which will require an investment in the hundreds of millions of euros. That digital overhaul comes at a cost: roughly 3,000 full?time positions will be eliminated across the group.

For 2026 alone, the profit goal has been raised to at least €3.4 billion.

Labour representatives at the AGM contrasted the job cuts under the stand?alone plan with the far more draconian scenario they fear under UniCredit. A merger with the Italian group’s German subsidiary HypoVereinsbank could result in the loss of up to 23,000 jobs, they warned.

Investors Largely Unswayed

So far, the hostile bid has failed to capture the imagination of Commerzbank’s owners. By mid?May, less than 1% of shares had been tendered. Major fund managers in Wiesbaden echoed the board’s scepticism. The representative from Deka called UniCredit’s approach “impulsive”, while DWS criticised the structure of the offer, noting that the Italian bank was effectively financing part of the acquisition out of the Commerzbank dividend it would receive.

Commerzbank at a turning point? This analysis reveals what investors need to know now.

UniCredit currently controls nearly 39% of the voting rights through derivative instruments, though it holds roughly 30% of the shares directly. The Italian group chose not to send any of its top executives to the AGM, according to media reports.

Two Deadlines, One Battle

The formal acceptance period for the exchange offer runs until June 16, 2026, after which UniCredit has set an extended deadline of July 3. Even if the bid succeeds, regulatory hurdles mean a deal is unlikely to close before 2027.

For now, Commerzbank’s defence rests on a straightforward argument: the numbers it can deliver on its own look more attractive than the paper that UniCredit is offering.

Ad

Commerzbank Stock: New Analysis - 20 May

Fresh Commerzbank information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.

Read our updated Commerzbank analysis...

en | DE000CBK1001 | COMMERZBANK | boerse | 69382607 |