Berlin, Germany’s state-owned investment bank KfW sold 110 million shares in telecommunications firm Deutsche Telekom on Monday, the German Finance Ministry said, stating the sale will benefit the country’s rail network.
“The federal government will use the net proceeds from the transaction to strengthen the equity capital of Deutsche Bahn AG and to expand the railway infrastructure in Germany in a forward-looking manner,” the ministry said, without mentioning the specific value of the sale.
Germany’s rail network is considered dilapidated and overloaded, with disruptions, repairs and construction work along major routes contributing to chronic punctuality issues for the railway.
Earlier on Monday, the KfW announced that intends to sell off another tranche of the shares that it holds in Deutsche Telekom to institutional investors for an estimated value of almost 2.5 billion euros ($2.7 billion).
The sale has reduced the German state’s stake – held directly and indirectly through the KfW – to 27.8%, the mi
nistry said.
“The KfW and the state will remain the largest shareholders in Deutsche Telekom AG,” the bank said when announcing the planned sale.
State-owned railway operator Deutsche Bahn announced at the end of April that it plans to renew 2,000 kilometres of track and 2,000 points this year as part of an effort to update the country’s ageing rail infrastructure.
Source: Qatar News Agency