Blackstone acquires 4.5% of Deutsche Telekom

24 Apr 2006

According to the Financial Time, the German government has selected private equity group Blackstone to take a strategic stake in Deutsche Telekom. Blackstone will pay KfW, the state-owned development bank, EUR2.68 billion for a 4.5% stake; the price per share is EUR14, a 2.6% premium on last Friday’s closing price. The German government will retain a 15% stake in Deutsche Telekom. ‘We are committed to being long-term investors in the company and our intention is to support the company and its management, particularly at supervisory board level, in executing a strategy of long-term value creation,’ said Stephen A. Schwarzman, chief executive of Blackstone.

.

The move is unusual for Blackstone, which typically makes equity investments where it has a controlling interest rather than building a minority holding. Along with many of the world’s largest private equity groups, it has been bidding for several European telecoms and cable assets, including, most recently, TDC of Denmark. Blackstone is also thought to be part of a consortium looking at acquiring Portugal Telecom. Apax, KKR, Providence Equity, Cinven, Apollo Management and Silver Lake Partners are among the rival private equity groups also thought to have bid for the Deutsche Telekom stake.

Germany, Deutsche Telekom (DT)