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Commerzbank faces split?
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June 26, 2000: 6:35 a.m. ET
Report: Three-way break-up bid awaits any failure of Dresdner talks
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LONDON (CNNfn) - Commerzbank AG may face a joint bid from three of its alliance partners, which could then break up the German bank, if merger talks with domestic rival Dresdner Bank AG don't lead to a deal, according to a report published Monday.
Commerzbank, the German No. 4 by the value of its assets, said last week it was in talks with third-ranked Dresdner. Commerzbank has come under pressure from its largest shareholder, investment firm, Cobra Beteiligungs GmbH, to seek a partner.
While the talks with Dresdner are reported to be progressing, German newspaper Handelsblatt said that three existing Commerzbank partners are considering a joint bid that would see Commerzbank broken up.
Spain's largest bank, Banco Santander Central Hispanoamericano SA, Italy's Banca Intesa SpA and Italian insurer Assicurazioni Generali SpA already hold a combined 11 percent stake in Commerzbank and have a series of separate strategic alliances with the German bank.
 Commerzbank (FCBK) shares jumped 4.3 percent to  38.80 in Frankfurt Monday, though the bank played down the report, citing chief executive Martin Kohlhaussen's recent statement that the bank would not be broken up.
Handelsblatt reported that a break-up bid would see Generali, the third-ranked European insurer, take Commerzbank's asset management business. This would build on its existing deal to distribute its insurance products through the German bank's consumer banking network. Generali denied any joint bid was planned.
Banca Intesa, Italy's largest bank, would acquire Comdirect, which Commerzbank has built into Europe's largest direct brokerage operation, selling a stake in the business in an initial public offering last month.
Commerzbank's own consumer banking operation would be sold off under the plan, with its investment banking arm acquired by BSCH, though the Spanish bank was quick to dismiss the report.
Kohlhaussen has in the past sought to distance Commerzbank from the consolidation gripping Europe's banking sector, pushing a strategy of alliances including investment banking ties with BSCH, Banca Intesa and France's Crédit Lyonnais (PCL), in which the German bank has a 5 percent stake.
However, he reassessed his approach following the collapse in March of Dresdner's planned merger with Deutsche Bank (FDBK), and Cobra's accumulation of a 17 percent stake. The investment group favors a cross-border tie, while Kohlhaussen said last week that a domestic deal would generate greater synergies. 
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