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Sale of Dresdner to Commerzbank is Imminent - Report

Tom Burroughes Deputy Editor London 29 August 2008

Sale of Dresdner to Commerzbank is Imminent - Report

A deal to sell Dresdner Bank, the parent of UK private bank Kleinwort Benson, to rival German bank Commerzbank for about €9 billion looks to be imminent, according to a report by the Financial Times.

Dresdner Bank is owned by the German financial services conglomerate Allianz. Yesterday, Allianz and the likely buyer said they would hold extraordinary meetings over the weekend to try to complete a deal.

Allianz, Europe’s biggest insurance group, confirmed it would bring together its supervisory board to discuss the sale of Dresdner and also halted plans to split up the bank prior to a sale.

The steps suggest an impending deal to sell the whole of Dresdner to Commerzbank, creating a bank with Germany’s largest branch network and the ­second-biggest asset base, behind Deutsche Bank.

But an alternative deal, to sell Dresdner to China Development Bank, remained an option,  people familiar with Allianz said. They also said either transaction might still fall through.

Commerzbank remains the frontrunner to land Dresdner. Commerzbank’s supervisory board, led by Klaus-Peter Müller, the bank’s former chief executive, is also to meet on Sunday in what one observer said was a “choreographed” move.

A deal between the two German banks – both based in Frankfurt – would be the biggest step in years to consolidate the country’s fragmented financial sector, where profit margins are among the lowest in Europe and most retail consumers use small co-operative or locally owned savings banks.

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