Exclusive: Germany eyes windfall from sale of Telekom, Post stakes

Tue Nov 11, 2014 11:14am EST
 
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By Matthias Sobolewski

BERLIN (Reuters) - The German government is considering selling its stakes in Deutsche Telekom (DTEGn.DE: Quote) and Deutsche Post (DPWGn.DE: Quote), a move which could bring up to 24 billion euros into state coffers at a time when Berlin faces pressure to spend more on infrastructure.

A finance ministry document seen by Reuters, which is due to be approved by Chancellor Angela Merkel's cabinet on Wednesday, sketches out plans to reduce government holdings in a range of companies, the most politically sensitive being rail operator Deutsche Bahn.

The government had wanted to sell a minority stake in Deutsche Bahn in Merkel's first term, but canceled the plan when the global financial crisis hit in 2008. Any sale now would depend on market conditions, the document said.

Merkel's "grand coalition" government has promised to balance the federal budget next year for the first time since 1969 and a share sale could help it do that at a time of slowing growth and reduced tax revenues.

It could also free up cash for public investments as Merkel is under pressure from European partners and domestic industry to spend more to stimulate the economy and shore up Germany's crumbling infrastructure.

At Monday's closing share price, the government's 31.7 percent stake in Deutsche Telekom -- which includes a 14.3 percent direct stake and a 17.4 percent indirect holding via state bank KfW -- was worth over 17 billion euros.

Its 21 percent stake in Deutsche Post, held by KfW, was worth over 6 billion euros. Together, the stakes could fetch roughly 24 billion euros, although the government could choose to sell a portion, rather than all of its shares in the firms.

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The logo of German company Deutsche Telekom is pictured at the CeBit computer fair in this file photo taken in Hanover, March, 6, 2012.  REUTERS/Fabian Bimmer