Italian insurance giant Generali announced that it plans to practically double its current stake in Germany’s Commerzbank, from 5.2 percent to 10 percent. The move was seen by analysts as a way of protecting the insurer’s German business, which amounts to 29 percent of its total revenue, €11 billion ($9.9 billion) in 1999.
In a series of complicated transactions, Generali, through its German unit, Aachener und Münchener Beteiligungs AG, will exchange its shareholdings in Banco Santander Central Hispano for Commerzbank shares, and will purchase 17 million shares at the current market price, for around €600 million ($540 million).
Generali, Europe’s third largest insurer, thereby increases its role in the increasingly complex negotiations involving Dresdner Bank, Allianz and Deutsche Bank, and further improves Commerzbank’s defenses against a hostile takeover.
Rebon, the Dutch based Group which controls 17 percent of Commerzbank’s shares, has reportedly been seeking a non-German alliance, which if it occurred, might threaten some of the cross-selling arrangements Generali currently has with Commerzbank.
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