Deutsche Bank AG and Commerzbank AG shares fell, after a large investor sold its stake in Germany to its two largest publicly listed banks.
An unknown investor seeks to raise 1.38 billion euros ($ 1.5 billion) by selling 116 million shares in Deutsche Bank, while Commerzbank shares of 508 million euros ($ 555 million) were bought by an unnamed investor , according to terms seen by Bloomberg.
Deutsche Bank shares fell as much as 8.3% and Commerzbank shares fell 7.9% when markets opened on Tuesday.
There are currently only two investors in Deutsche Bank who have enough shares for such a large sale – BlackRock and Capital Group. BlackRock is for the most part a passive investor and most of its interest is tied to Deutsche Bank’s membership in several equity indices and therefore cannot be sold as one.
The sale of major interests in the two lenders comes just three months after private equity firm Cerberus began to relax its interests in the same companies, essentially the plug from an investment that proved a losing bet. It also follows on the heels of the decision by US investment firm Capital Group to withdraw from Barclays Plc.
Both Deutsche Bank and Commerzbank are embedded in ambitious turnaround programs to increase their profitability. The prospect of rising interest rates in the euro area boosted its share prices at the beginning of the year, although the war in Ukraine more recently has cast a shadow over the outlook for the banking sector.
The unknown investors offer Deutsche Bank share at a price range of 10.98 euros at market price, as the closing of the stock exchange on Monday of 11.924 euros. Commerzbank stock is meanwhile being offered at 6.52 euros to 7.012 euros. Morgan Stanley regulates share sales. The holders abandoned their interests in the two companies, showing the terms.
Spokesmen for Capital Group and Commerzbank declined to comment.
“We remain confident in our strategy as enacted during our Investor Deep Dive in March,” a Deutsche Bank spokesman said. “Our focused business model and risk management capabilities have proven their worth in challenging times. As we said during our investor day, we had a promising start to the year and our goals remain unchanged.
Big stake sales have in recent days begun to flood the market with stakes being dropped in the love of energy company E.ON SE, aircraft maker Airbus SE, financial company London Stock Exchange Group Plc and mining giant Glencore.