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Boerse's IPO to raise $880M
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January 22, 2001: 8:46 a.m. ET
German stock exchange operator to raise money to power consolidation efforts
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LONDON (CNNfn) - Deutsche Boerse said on Monday it plans to raise 941 million euros ($880 million) by way of a stock market flotation, to fund possible acquisitions.
The operator of the Frankfurt stock exchange said the shares, representing one third of its capital, will be sold at between  285 and 335, valuing the firm at around 3 billion.
Deutsche, Europe's third-largest stock exchange, resurrected plans to float after an attempted merger with the London Stock Exchange was shot down last year.
The company, majority-owned by a collection of banks, needs the shares to act as a currency in the next round of European stock market consolidation. Boerse plans to sell 2.81 million shares to retail and institutional investors in Germany and selected international financial institutions.
European stock markets are under considerable pressure from institutional and retail investors to merge, thereby slashing the cost of trading and offering more stocks through one exchange trading platform.
Deutsche's initial public offering will be widely watched by other bourses, such as three-centre Euronext which is planning to go public in May. Amsterdam, Brussels and Paris merged last year creating Europe's No. 2 exchange.
By market capitalisation, Deutsche Boerse will be bigger than OM Gruppen, which is valued at about $2.2 billion, while the London Stock Exchange is worth about $1 billion.
The LSE is Europe's biggest stock exchange measured in terms of the value of companies listed on it. According to the Federation of European Stock Exchanges, the LSE is valued at 3 trillion compared to Euronext's 2.6 trillion and Deutsche's 1.5 trillion.
Demand for shares in Frankfurt's IPO is expected to be strong, with previous reports indicating the issue could be two to three times oversubscribed.
Banks representing Boerse will seek to gauge investor demand over the coming week, with the shares being priced over the weekend of Feb. 3. The shares will begin trading in Frankfurt on Monday Feb. 5.
Deutsche Boerse owns the Frankfurt bourse, 50 percent of cross-border settlement house Clearstream International, half of derivatives exchange Eurex -- one of the largest in the world -- and is also active in energy and metals trading.
--from staff and wire reports 
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