Deutsche Bank Expects DWS Group IPO To Raise €1.2 Billion
Deutsche Bank had earlier announced that it plans to offer twenty percent of its asset-management unit DWS Group via an Initial Public Offering (IPO). On Sunday, Deutsche Bank indicated that the value of its DWS unit is estimated to be around €6 to €7.2 billion and based on this estimate, the bank provided an indication on the possible share prices of the DWS IPO.
Share Prices To Range Between €30 to €36 Per Share
The first day of trading for the DWS IPO is expected to be on March 23 at the Frankfurt Stock Exchange. Deutsche Bank is positive that the share prices for the IPO will range between €30 and €36 per share. If Deutsche Bank managed to get the high price of €36 per share, then the IPO will raise close to €1.2 billion. The listing prospectus is expected to be released on Monday.
Deutsche Bank has worked on this IPO for close to 12 months but the €1.2 billion that the bank is expected to raise is still short of what the bank had earlier estimated. The bank has admitted that it could end up putting another 5 percent of DWS shares for sale which could raise a potential €188 million. Deutsche Bank is acting as the worldwide coordinator for the IPO while multiple banks such as UBS, Morgan Stanley and BNP Paribas will act as bookrunners.
Nippon Life Insurance Co has already confirmed that it will be a major investor in the DWS IPO and is set to acquire a 5 percent stake. Japan’s Nippon will take on the responsibility of helping DWS establish its brand in Asia and will also distribute DWS products and services going forward.
Deutsche Bank Looking To Turn Things Around
CEO John Cryan has a tough job ahead of him in turning around the fortunes of the bank. The funds from the IPO is critical to Cryan’s efforts in helping to get Deutsche Bank moving in the right direction. The bank is reported to have suffered close to €500 million in losses in 2017 and a huge portion of those losses is directly related to the €1.4 billion charge the bank had to pay as a result of a tax overhaul in the United States. If Deutsche Bank did not have to pay the €1.4 billion charge, the bank would have had a net income of €900 million in 2017.
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