The German government has declined to sell its shares in German lender Commerzbank to Italy's UniCredit, as the Italian bank seeks to take over the German rival.
"Accepting the offer was out of the question from a financial point of view, as the takeover bid does not include an appropriate premium on the current price of Commerzbank shares," the Federal Finance Agency said in a statement on Tuesday.
The government in Berlin, which holds a 12% stake in Commerzbank, making it the bank's second biggest shareholder, again criticized UniCredit for seeking to take over the German bank.
The statement reiterated that the government supports Commerzbank’s strategy of maintaining its independence, slamming UniCredit's "aggressive" takeover approach.
Commerzbank, the second largest private bank in Germany, "plays a vital role in financing the German economy and small and medium-sized enterprises," it said.
"As a major employer, it is also central to Frankfurt as a financial centre. Both of these aspects must be safeguarded in the future."
UniCredit submitted a takeover bid for Commerzbank in early May and says it has so far received offers for some 11% of all Commerzbank shares. This would increase the Italian lender's stake to some 38%. It has additionally secured more than 3% of Commerzbank shares through call options and other financial instruments that it holds.
