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Cerberus cuts Deutsche Bank,Commerzbank stakes in $500 million share sale

Stock MarketsJan 10, 2022 03:51PM ET
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© Reuters. FILE PHOTO: A Deutsche Bank logo adorns a wall at the company's headquarters in Frankfurt, Germany June 9, 2015. REUTERS/Ralph Orlowski

By Alexander Hübner and Christoph Steitz

FRANKFURT (Reuters) - U.S. financial investor Cerberus, which has favoured a merger of Deutsche Bank (DE:DBKGn) and Commerzbank (DE:CBKG) in the past, on Monday divested a large chunk of its holdings in the two top German lenders, the bank running the sale said.

The sale marks a significant scaling back by one of the most prominent investors in the financial sector of Europe's largest economy and comes at a time when large-scale consolidation in the continent's banking sector is still waiting to happen.

Cerberus, which until now held around 3% of Deutsche Bank and 5% of Commerzbank and had ranked among the top-10 shareholders of both banks, sold 21 million Deutsche Bank shares and 25.3 million Commerzbank shares, Morgan Stanley (NYSE:MS) said.

Cerberus, which took stakes in both banks in 2017, fetched 443 million euros ($502 million) in the sale, Morgan Stanley said, a roughly 3% discount to Monday's closing price.

The divestment reduces Cerberus' stake in Deutsche Bank to around 2%, and its stake in Commerzbank to 3%.

Cerberus has committed to a 45-day lock-up period during which it will not sell additional stakes, Morgan Stanley said.

Deutsche Bank and Commerzbank shares were down 1.9% and 4.9% respectively in after-hours German trading following the news.

Cerberus has at times been a vocal investor, demanding changes at Commerzbank in 2020 that prompted a management reshuffle as well as substantial job cuts.

Since Cerberus bought its stakes, shares in both lenders are down more than 20%.

The investor did not respond to requests for comment.

Deutsche Bank and Commerzbank both declined to comment.

($1 = 0.8832 euros)

Cerberus cuts Deutsche Bank,Commerzbank stakes in $500 million share sale

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