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3/10/06

MarketWatch.com: EU to intensify fight with Poland over Unicredit deal

For the full report go to MarketWatch.com

EU to intensify fight with Poland over Unicredit deal

BRUSSELS (MarketWatch) -- Battling a recent surge in economic nationalism, the European Commission Wednesday will escalate its efforts to force Poland to allow Italian lender UniCredit SpA's (UC.MI) takeover of a Polish bank, Commission officials said.

Using a "pincer movement," Brussels antitrust and internal market regulators will order the Polish government to allow UniCredit's takeover of German bank Bayerische Hypo-und Vereinsbank AG's (HVM.XE) 71% stake in Bank BPH SA (BPH.WA), Poland's third-largest lender. UniCredit bought the German bank last year in a EUR17 billion deal. If Poland doesn't let this part of the deal go through, the Commission plans to ask a European court to force the takeover and perhaps fine Poland.

To prepare for this step, the Commission's antitrust authorities Wednesday will send Poland a letter giving the country two weeks to allow the takeover or face a so-called formal decision. If Poland doesn't comply, that decision will allow the Commission to seek court intervention and give UniCredit scope to to sue for civil damages in a Polish court, said Jonathan Todd, the Commission's antitrust spokesman.

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