Dresdner Kleinwort Benson Merger with Deutsche Bank Collapses Amid Dispute

German insurer Allianz, a key architect of the proposed merger between Dresdner Bank and Deutsche Bank, has been put on notice that Dresdner could now be a takeover target, following the collapse of the €33bn deal. The dispute centered around the future of Dresdner Kleinwort Benson, the London-based investment banking arm of Dresdner Bank. Allianz, which holds a 21% stake in Dresdner, had informed the bank that it would be withdrawing its protective hand and would be open-minded about accepting unsolicited takeover offers.

Key Takeaways:

• The merger between Dresdner Bank and Deutsche Bank collapsed amid a dispute over the future of Dresdner Kleinwort Benson, the London-based investment banking arm of Dresdner Bank.
• Allianz, the German insurer with a 21% stake in Dresdner, was a key architect of the proposed merger and has been put on notice that Dresdner could now be a takeover target.
• Dresdner accused Deutsche Bank of breaching the merger agreement by insisting that Dresdner Kleinwort Benson be sold, whereas the original terms of the agreement did not mention the sale of DrKB.
• Allianz held a 21% stake in Dresdner and had informed the bank that it would be withdrawing its protective hand and would be open-minded about accepting unsolicited takeover offers.
• The collapse of the deal is a blow to Germany's willingness to embrace reform, and competitors and analysts forecast a wave of follow-on deals in the financial sector.
• The failure of the merger will lead to the unravelling of the complex web of cross-shareholdings in Germany.
• The dispute between Dresdner and Deutsche Bank highlights the complexity of mergers and takeovers in the financial sector.

Statistics:

• €33 billion: The proposed merger between Dresdner Bank and Deutsche Bank.
• 21%: The stake held by Allianz in Dresdner Bank.
• 13.9%: The fall in shares of Allianz to €380.
• 4.2%: The rise in shares of Deutsche Bank to €80.01.
• 4.3%: The rise in shares of Dresdner Bank to €49.
• 27%: The fall in shares of Deutsche Bank since the merger announcement.

Sources:

• The Financial Times
• Reuters