Leading banks in German PostBank IPO fight
Deutsche Bank, Morgan Stanley and CSFB have emerged as the frontrunners to lead the initial public offering of Postbank, which is expected to be among Germany’s biggest flotations next year.
All three banks declined to comment last night, but one person close to Postbank – a division of Deutsche Post, the state-owned postal service – said a preliminary decision had already been taken ahead of a “beauty parade” last weekend.
Eight banks pitched for the potentially lucrative mandate last Saturday. Besides the three favourites, those invited to bid included Goldman Sachs, whose aggressive pitch is understood to have given it a chance of involvement in the deal.
Postbank, which could not be reached for comment, is known to want one German bank as well as at least one international bank to be joint global co-ordinators for its IPO.
Deutsche Post had said in the summer that it envisaged an IPO only within 18 months, but people close to the pitching process said a sale could come in the first half of next year.
Klaus Zumwinkel, Deutsche Post chief executive, has valued Postbank at more than Euros 5bn. After an IPO discount of 10 per cent, flotation of between 20 and 50 per cent of the bank would yield Euros 1bn-Euros 2bn.
Postbank has more than 10m customers and 12,667 branch offices and increased operating profits by 19 per cent to Euros 681m last year.
Its staid image, stemming from a focus on deposit-taking from retail customers, provide a challenge to the banks mandated with the IPO.
However, some bankers believe that it is precisely its unexciting low-risk business profile, in a sector that was otherwise routed last year by heavy loan losses, which could prove its biggest selling point.
