Deutsche Post, the semi-privatised German Post Office, has resumed plans for a E1bn benchmark bond issuance. The Bonn-based firm has appointed Credit Suisse First Boston and Morgan Stanley as lead managers and is to embark on a roadshow among institutional investors. It is scheduled to take place between 9-13 September, and will focus predominantly on Germany and the UK.
Read MoreIn an effort to secure for itself a concrete place in the international parcel business, Deutsche Post is set to purchase the remaining shares of express air courier DHL International of Brussels.
Deutsche Post, which is 70 percent owned by the German government, is Europe’s largest postal company, The company said July 5 it will purchase the 25 percent stake of DHL owned by Lufthansa for about $593 million. It currently owns 50 percent of the company and controls its management.
In addition to the Lufthansa shares, DeutschePost said it has plans to acquire additional shares owned by Japan Air Lines and other institutional investors. DHL is the largest air express carrier outside the U.S.
Deutsche Post will be allowed to set its own prices when it breaks into the UK business post market, posing an aggressive threat to Consignia’s fading monopoly.
The regulator is set to grant a one-year interim licence that allows Deutsche Post to collect pre-sorted and some unsorted mail from customers in the UK. The group will use rival company Consignia’s network to deliver about 90 per cent of the mail, while the rest will go through its subcontracted delivery services.
Deutsche Post and Consignia will have to agree a fair price between them, says Postcomm. “Deutsche Post must decide what to do,” says a Postcomm spokesman. When asked if there was the potential for Deutsche Post to undercut Consignia on discounts or pricing for bulk mail, he says: “I imagine they will have something to offer but it is up to them.”
The German government has asked the European Union for more time to come up with a plan for reclaiming at least EUR572 million in state aid to Deutsche Post AG (G.DPW), the finance ministry said Friday. The government has asked the E.U. Commission, the E.U.’s executive branch, to delay the deadline for the plan until Oct. 1, finance ministry spokesman Thomas Gerhardt said. The Commission set an Aug. 22 deadline for the plan when it ruled in mid-June that the state aid to the partially privatized mail company was illegal. It has yet to respond to the government’s request, Gerhardt said. The finance ministry fully expects the request to be accepted, Gerhardt added, saying it was based simply on understaffing at the ministry during the summer holidays. On June 19, the Commission ordered Deutsche Post to repay EUR572 million to the German government on the grounds the company used profits from a guaranteed monopoly letter business to undercut parcel-sector rivals between 1994 and 1998. In response, Deutsche Post said it would take a EUR850 million one-off provision in its accounts, including accrued interest. The repayment amount will be between EUR572 million and EUR820 million, according to the finance ministry’s Gerhardt. Though it took the one-off provision, Deutsche Post also pledged to appeal against the E.U. ruling at the European Court of Justice in Luxembourg.
Read MoreGerman postal firm Deutsche Post is to begin mail services in the UK, dealing with pre-sorted and sorted mail from collection points.
About 90 per cent will be passed to Consignia for delivery.
The firm’s year-long licence limits the annual amount it can carry to 40 million items.
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