February 20, 2018 / 12:16 PM / a month ago

Deutsche Bank to launch DWS IPO next week, sources say

FRANKFURT (Reuters) - Deutsche Bank (DBKGn.DE) plans an initial public offering of its asset-management arm, DWS, on Monday next week, following on the heels of Siemens’ (SIEGn.DE) blockbuster Healthineers listing, sources close to the matter said.

FILE PHOTO: A red traffic light is photographed in front of the head quarters of Germany's largest business bank, Deutsche Bank, in Frankfurt, Germany, December 6, 2017. REUTERS/Kai Pfaffenbach

They said the listing of DWS on the Frankfurt stock exchange would probably take place in the week starting March 19.

Germany’s Deutsche Bank is planning to offer 25 percent of existing DWS shares for an expected 1.5 billion to 2 billion euros ($1.85 billion to $2.47 billion), the people said, adding no new shares would be sold as part of the offering.

Deutsche Bank declined to comment.

“Transaction security is more important for Deutsche Bank than price”, one of the people said.

To maximize investor attention, the debut will take place before Holy Week, the week before the Easter holidays, when some investors are expected to be away, another source said.

Siemens on Monday announced plans to float its medical imaging and diagnostics business Healthineers on the Frankfurt stock exchange, with the listing expected to take place in March.

“Following several U-turns in Deutsche’s strategy, it is important that the bank delivers on the promises it made last year,” one of the people said.

Deutsche Bank announced in March 2017 that it would list a minority stake in its asset-management arm, as part of a broader overhaul following costly lawsuits and trading scandals.

    The unit has assumed the legal structure of a partnership limited by shares, or KGaA. That ensures Deutsche Bank can keep control even if its shareholding falls below the 75 percent usually needed to dominate German stock corporations, possibly as part of a merger of the unit with a peer.

    “We want to unlock the full potential of Deutsche AM to facilitate growth,” unit head Nicolas Moreau has said, and earlier this month said that it is making progress preparing for the offering.

    The listing is expected to help the unit attract and retain talent by awarding bonus shares to staff. It will also enable the unit to use its shares to fund acquisitions.

    The business is looking for ways to strengthen its so-called alternative products offerings, especially in areas such as structured credit and real estate asset management. It also want to bolster its distribution network and expand in countries such as Japan, Korea, Taiwan and Singapore.

    Deutsche Asset Management had 3,800 staff managing 700 billion euros invested worldwide at the end of 2017. The unit’s adjusted pretax earnings rose 5 percent to 747 million euros last year.

    Editing by Maria Sheahan, Larry King

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