Deutsche Bank reaffirms its Postbank stake purchase
Deutsche Bank AG said it remains committed to plans to buy a stake in Deutsche Postbank AG in the first quarter and refused to comment on a report it was seeking to renegotiate the terms.
Read MoreTag: Postbank
Deutsche Post announces Board changes
Wulf von Schimmelmann will succeed Jürgen Weber as chairman at Deutsche Post.
Read MoreDeutsche Post AG supports Postbank strategic initiative
The Supervisory Board of Deutsche Post AG has approved that Deutsche Post, as majority shareholder of Deutsche Postbank AG, will participate with up to 100 percent in the bank’s planned capital increase. The Group thus supports the strategic initiative presented by Postbank to further develop its successful strategy and a sustainable improvement of earnings quality.
Deutsche Post has committed to subscribe to the planned rights issue of 54.8 million shares at the subscription price according to its stake of 50 percent plus one share in Postbank. As far as the subscription price does not exceed 18.25 euros, Deutsche Post has also committed to subscribe to all shares that are not taken up by the market at the subscription price. The maximum commitment by Deutsche Post thus would not exceed 1 billion euros, which it would finance out of the Group’s cash flow.
As a result of this measure, Deutsche Post’s stake in Postbank would initially increase to a maximum of 62.52 percent. The September agreement with Deutsche Bank AG, under which it will – upon antitrust and regulatory approvals – acquire a 29.75 percent stake in Postbank from Deutsche Post in the first quarter of 2009, remains in place.
Deutsche Post World Net provides preview of third quarter 2008
Deutsche Post World Net recorded a decline in EBIT before non-recurring effects of around 8 percent in the third quarter compared with last year’s 468 million euros as the global economic environment deteriorated markedly. Third-quarter reported EBIT rose 26 percent from last year’s 1.68 billion euros, reflecting a 572 million-euro non-recurring effect on EBIT due to a repayment from the German government following a court decision on EU level. In the first nine months, underlying EBIT gained 1.3 percent compared with the year-earlier period.
The Group now expects underlying EBIT for 2008 of around 2.4 billion euros, some 10 percent below last year’s result and 17 percent below the previous guidance. Adjusted for the accounting changes following the agreement to sell a 29.75 percent stake in Deutsche Postbank AG to Deutsche Bank AG, the Group previously had forecast EBIT of around 2.9 billion euros. Including Postbank, the forecast was 4.1 billion euros. For transparency reasons, the Group will be showing EBIT without Postbank going forward. The main shortfall will be seen in the EXPRESS Corporate Division, which is being particularly impacted by deteriorating market conditions in the U.S. The Group also recorded volume shortfalls in other regions, but those could be mitigated through cost-cutting. Other divisions are likely to be slightly below previous guidance.
"It's a win-win-win solution!"- Interview with Frank Appel and John Allan
A unique and powerful banking partnership is developing in Germany: Deutsche Bank is taking a major share in Postbank and the companies have signed a far-reaching cooperation agreement. This transaction marks a major step forward in the German banking consolidation, strengthening Germany as a financial center, while guaranteeing job security and continuity. Deutsche Bank’s stake of just below 30 percent gives Postbank a basis for further dynamic growth – and Deutsche Post can keep concentrating on its core business.
DPWN News spoke to Chief Executive Officer Frank Appel and Chief Financial Officer John Allan about the transaction, which significantly changes the German banking landscape.
Mr. Appel, why is Deutsche Post selling 29.75% percent of Postbank’s shares to Deutsche Bank?
Appel: In the past 10 years Postbank has developed very successfully with Deutsche Post as majority owner. Today it’s the leading German retail bank with 14.5 million loyal customers, a position that we are very proud of. Deutsche Post has benefited from this partnership as well as it allowed us to fully leverage the strength of the Group’s branch network.
In order to secure the same kind of growth for both Postbank and Deutsche Post in the future, we took a thorough look at a variety of options during the past months. We are convinced that the agreement with Deutsche Bank is the very best solution for all stakeholders – for Postbank, because they gain a strong new shareholder with an excellent reputation, which stands for continuity and growth; for Deutsche Bank, because of Postbank’s key position in the German retail market; and for Deutsche Post, because we can concentrate mid-term on our core competencies in logistics, express and mail.
Most people had expected Postbank to be sold completely – what made you decide for the two-step model?
Appel: We are very excited that we have found a win-win-win solution with such a growth-oriented structure: Postbank gets a strong new shareholder, and the following steps can be completed smoothly. No one will have to chase any integrations targets and there will be no changes to Postbank’s winning formula. Employees and customers alike won’t feel a difference, except for a wider product range and better service. Deutsche Post now has a clear path to a mid-term exit.
This deal creates additional value for investors, just as we pledged in our Roadmap to Value capital markets program: The proceeds will be a central component for our considerations of returning it to our shareholders and on top we can generate more value out of our logistics and express businesses in the long term.
First Dresdner and Commerzbank – now Deutsche Bank and Postbank: does that herald branch attrition and mass redundancies?
Appel: Absolutely not. What we achieved here is an agreement purely driven by growth – cost cutting is not an issue and shareholders benefit from a strong valuation. Continuity in management and brands goes along with job security for Postbank’s employees. On top of that, both partners envisage substantial revenue growth from future cooperation. These benefits will be there without costly rebranding or transition efforts. With our innovative model we will show that it is possible to consolidate in a different way: without job losses or the mass closure of branches. We are convinced that this partnership will create a new heavyweight in the European banking market and strengthen Germany as a financial center.
What are the advantages for Deutsche Post and Postbank from this sale?
Appel: For Postbank, the new structure means first and foremost planning security. With their unique retail platform, they can now focus fully on exploiting the growth opportunities in a market that is currently undergoing a profound transformation. It is especially positive that branches, jobs and the brand will remain untouched. Also, management and corporate governance will continue unchanged.
For
Read MorePost & Parcel Magazine
Post & Parcel Magazine is our print publication, released 3 times a year. Packed with original content and thought-provoking features, Post & Parcel Magazine is a must-read for those who want the inside track on the industry.