Sept. 13 (Bloomberg) — Deutsche Bank AG, Germany’s largest bank, plans to raise at least 9.8 billion euros ($12.5 billion) in its biggest-ever share sale to take over Deutsche Postbank AG and meet stricter capital rules.
Deutsche Bank expects to offer between 24 euros and 25 euros a share in cash to Postbank stockholders to increase its 29.95 percent stake in the lender, the Frankfurt-based bank said yesterday. The company intends to book a charge of about 2.4 billion euros in the third quarter as it marks down the value of its existing Postbank holding.
Chief Executive Officer Josef Ackermann is planning the biggest rights offer in Europe this year as he seeks to reduce Deutsche Bank’s dependence on investment banking by gaining control of Postbank, a consumer lender based in Bonn. The capital increase will also help Deutsche Bank meet new rules from global regulators that more than doubled banks’ capital ratios.
“Deutsche Bank is doing it all at once — bidding for Postbank and topping off its coffers,” said Peter Thorne, a London-based analyst at Helvea Ltd. who is reviewing his rating on the stock. “This will help them move into line with their international peers in terms of capital.”
Subscribers should recall that I went over this in some detail in the beginning of the year. I consider Postbank to be insolvent. See the following subscriber downloads:
- Deutsche Bank vs Postbank Review & Summary Analysis – Pro & Institutional
- Deutsche Bank vs Postbank Review & Summary Analysis – Retail
For those who do not subscribe, here is the first page of that professional document release in May of this year: