Commerzbank shares drop 10 pct on news of Dresdner takeover

0 Comments | AFP, September, 2008

FRANKFURT (AFP) — Shares in Germany's second biggest bank, Commerzbank, fell 10 percent on Monday after it announced a near 10-billion-euro takeover of number three Dresdner Bank.

Investors pushed the share price down by 10.20 percent to 18.04 euros at the close on the Frankfurt stock exchange, while the DAX index of German blue chips finished 0.01 percent lower overall.

Commerzbank, which has a market value of 13 billion euros (19 billion dollars), is to finance its 9.8-billion-euro purchase in cash and stock with two capital increases that must be approved by shareholders.

Standard and Poor's lowered its outlook on the bank meanwhile to "negative" from "stable," citing "risks associated with the acquisition and the difficult market environment."

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