Revenues generated from Telekom stocks will enhance the railway system.
In a short span of time, the federal government managed to earn a whopping one billion dollars from selling shares of Telekom. Now, the finance ministry reveals that the funds will be put towards enhancing the equity capital of Deutsche Bahn AG and upgrading the German railway infrastructure.
The government made a hefty 2.43 billion euros from selling Telekom shares and plans to use the profits to boost Deutsche Bahn AG's equity capital and modernize railway facilities in Germany. The finance ministry reports, "[The] Federal Government will use the net proceeds of the transaction to strengthen the equity capital of Deutsche Bahn AG and build future-oriented railway infrastructure in Germany." No specific figure has been disclosed.
KfW announced on Monday following the market's closure that it successfully sold 110 million shares of the DAX company, Deutsche Telekom, to institutional investors. "Thanks to the favorable market conditions, the placement was executed successfully," declared the finance ministry. The joint stake of KfW and the federal government in Deutsche Telekom AG has dwindled to approximately 27.8 percent.
The federal government carries on with its prudent privatization policy as stated by the minister. "Given the persisting federal interest, the Federal Government and KfW will stay the principal shareholders of Telekom AG and will maintain the appropriate shareholding percentage," per a press release from the Development Bank. "The KfW and the Federal Government remain the largest shareholders of Deutsche Telekom AG." Currently, in the second quarter, KfW sold 22.4 million shares publicly. By the end of 2023, the federal government and KfW will still own roughly 30 percent of Telekom.
