visimoney
TLDR:
- Germany’s state-owned development bank, KfW, has sold shares in Deutsche Post for approximately $2.3 billion, reducing the government’s stake and raising funds for railway improvements.
- The sale cuts the state’s stake in Deutsche Post to 16.5%, making it the largest single shareholder.
- The proceeds from the sale will be used to strengthen the capital of the state-owned railway operator, Deutsche Bahn, to upgrade railway infrastructure.
- The German government is using privatization proceeds to finance improvements to the rail network after a court ruling forced it to reconsider its financial plans.
- In November, Germany’s highest court annulled a decision to repurpose €60 billion originally meant for pandemic relief to instead address climate change and modernize the country.
Germany’s state-owned development bank, KfW, has sold shares in Deutsche Post, the company that owns the national postal service, for approximately €2.17 billion ($2.3 billion). The sale, which amounts to 4% of the company’s shares, reduces the German government’s stake in the company to 16.5%, although it remains the largest single shareholder.
The proceeds from the sale will be used to strengthen the capital of Deutsche Bahn, the state-owned railway operator, in an effort to upgrade railway infrastructure. This move comes after a court ruling forced the government to find alternative funding sources for improvements to the rail network. In November, Germany’s highest court annulled a decision made in 2022 to divert €60 billion intended for pandemic relief to address climate change and modernize the country. The government is now turning to privatization proceeds to fill the budget gap.
The sale of shares in Deutsche Post is part of a wider strategy by the German government to reduce its stake in formerly state-held companies. KfW, as the government’s development bank, holds the remaining stakes in these companies and is responsible for divesting them. The funds generated from these share sales will be crucial in financing infrastructure improvements and meeting the country’s financial obligations.
Overall, this sale represents a significant step in the German government’s efforts to strengthen its railway infrastructure. By using the proceeds to bolster Deutsche Bahn’s capital, the government aims to address the challenges faced by the rail network and ensure its modernization. With ongoing developments in transportation technology and increasing demands for sustainable modes of travel, these improvements are seen as essential for Germany’s economic growth and environmental goals.
