Bonds Syndicated loans Mergers and Acquisitions US deals of the year
EQUITY
European retail loves DT
Issuer: Deutsche Telekom
Type of deal: secondary equity offer
Amount: €11 billion
Date: June 25 1999
Global coordinators: Deutsche Bank, Dresdner Kleinwort Benson, Goldman Sachs
The e11 billion ($11 billion) second sale of shares in Deutsche Telekom completed last June was the largest ever secondary equity offer in Europe and the first ever truly pan-European retail offering of stock. The issuer and its lead banks - Deutsche Bank, Dresdner Kleinwort Benson and Goldman Sachs - set out with the intention of making Deutsche Telekom shares a core holding in the portfolios of Europe's growing army of retail equity investors. The long-term aim was to find a shareholder base broad enough to support a full privatization of the company, which is still majority-owned by the German state.
That was a challenging task. The arrival of the single currency and the flow of funds into equity from low-yielding government bonds had created a promising background for attempting a retail share offer across 11 countries. But many technical obstacles still had to be overcome. Regulations on share offers have still not been harmonized across Europe and the issuer and Dresdner Kleinwort Benson, which took charge of a 38-bank syndicate for the pan-European retail offer, endured protracted negotiations with national stock exchanges and regulators over questions of prospectus-filing and disclosure.