Germany's state-owned development bank KFW has raised €2.2 billion ($2.3 billion) by selling a stake in the formerly wholly government-owned postal company Deutsche Post AG.
The bank sold 50 million shares, equivalent to 4% of its shares, at a price of €43.45 per share in a quick overnight offer. The price represents a discount of 2.2% from the closing level of “Deutsche Post” yesterday, Tuesday.
The stock fell 3.9% on Wednesday, reaching €42.66 euros .
This share sale deal reduces KfW's stake in Deutsche Post to about 16.5% from 20.5%.
Germany's Free Democrats, a coalition ally of Chancellor Olaf Scholz, had supported plans to reduce holdings in Deutsche Post and Deutsche Telekom AG to boost state resources.
This option was considered when Schulz's Social Democrats, Greens and FDP formed a majority in 2021 in order to explore ways to increase public funding.
According to a statement issued by the Ministry of Finance, the German government plans to use the proceeds from the deal to support the state-owned railway company Deutsche Bahn AG and expand the associated infrastructure.
JP Morgan Chase, Bank of America and Deutsche Bank arranged the sale.