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Dresdner finds new ally?
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April 13, 2000: 10:00 a.m. ET
Commerzbank open to talks as Dresdner mulls DKB spin-off
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LONDON (CNNfn) - Commerzbank said Thursday it is open to talks about a alliance with Dresdner Bank, which just two weeks ago abandoned a planned  30 billion ($28.7 billion) merger with German banking leader Deutsche Bank.
A Commerzbank official said that Germany's fourth-largest bank is "open to an exchange of views" with Dresdner, which is No. 3 in Germany, although the person said such talks would not extend to a merger of the banks.
"The best option would be to join forces on a national front, but to do that you need a common business basis," said Commerzbank spokesman Dennis Phillips.
Phillips said Commerzbank had not held any talks with Dresdner since the collapse of the Deutsche-Dresdner merger.
"It's up to Dresdner to decide what to do next," said Phillips.
As the smallest of Germany's major banks, Commerzbank has been seen as vulnerable to takeover. It has sought to maintain its independence by striking alliances with other European banks, including Crédit Lyonnais of France and Italy's BCI.
Meanwhile, analysts have said Dresdner become a possible takeover target following the collapse of the Deutsche deal. In the months before it disclosed the plan to merge with Deutsche, it had held co-operation talks with HypoVereinsbank, Germany's second-largest bank. A common shareholder also links Hypo and Dresdner: Allianz, the second-largest insurer in Europe, owns nearly 21.7 percent of Dresdner and 17.6 percent of Hypo.
Phillips said Thursday that some kind of tie-up between Commerzbank and Dresdner could mitigate against a Dresdner-HypoVereinsbank tie, as Hypo lacks an international investment banking presence.
Dresdner eyes DKB spinoff
While Commerzbank emerged as a possible partner, Dresdner was close to announcing plans to spin off its Kleinwort Benson investment banking division into a separate company, a source at Dresdner told Reuters.
Dresdner is under pressure to outline a convincing strategy after its planned merger with rival Deutsche Bank fell apart. In an attempt to keep staff from defecting, Dresdner will offer DKB employees dividend-paying "virtual stocks" in the division, the source said.
A spokesman for DKB declined to comment. Dresdner could not be reached for immediate comment, but was expected to make a statement about coming management changes later Thursday, a person close to the matter said.
A spin-off would give autonomy to the investment banking division, which accounted for nearly 60 percent of Dresdner Bank's pretax profit last year. The planned 30 billion ($28.7 billion) deal fell apart earlier this month largely due to disagreements about how to address the overlap in investment banking.
The bank said as many as 300 DKB employees had quit by the end of March.
Dresdner was expected to announce  an array of managerial changes this week. It said last week that CEO Bernhard Walter, who would have been co-chief executive of the enlarged bank, will be replaced by Bernd Fahrholz, the board member responsible for Dresdner's global corporate business.
In addition, the source at Dresdner Bank said management board member Ernst-Moritz Lipp would step down by the end of the week. This will make him the third management board member planning to leave after Walter and Gerd Haeusler. No further management board members are expected to resign, the source said.
Shares of Dresdner Bank (FDRB) fell 1.5 percent to 46.95 early Thursday afternoon. Commerzbank (FCBK) gained 3 percent to 41.70, while HypoVereinsbank was 2.6 percent higher at 69.75. 
-- from staff and wire reports
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