Striking a Deal German Coalition Agrees on Deutsche Bahn Privatization

After months of wrangling between Germany's governing parties, a deal has been struck on the partial sell-off of national railway Deutsche Bahn. Just under a quarter of the company is now to be privatized.

The government has agreed to sell off a quarter of Deutsche Bahn.

The government has agreed to sell off a quarter of Deutsche Bahn.

The last major state-owned company in Germany, national train operator Deutsche Bahn, will be partly privatized after the parties in Germany's grand coalition reached an agreement following months of wrangling.

Chancellor Angela Merkel's conservative Christian Democrats and the center-left Social Democratic Party (SPD) decided Monday evening to privatize 24.9 percent of the company's passenger and freight divisions. All stations, tracks and energy supplies will still be owned by the state.

The partial privatization is expected to net between €5 billion ($7.8 billion) and €6 billion ($9.3 billion). According to SPD leader Kurt Beck, two thirds of the money will be invested into the railways and flow into the company's capital.

On Tuesday Transport Minister Wolfgang Tiefensee, a Social Democrat, said that the government hoped to push through the sale in November or December of this year. "Deutsche Bahn is a very special company and it can't be compared to others," he told Deutschlandfunk radio. "It is a safe investment that promises long-term success, both in terms of profits and the value of the stock itself. I am sure investors will come."

The coalition agreement comes after months of bickering over how much of the company should be privatized. Merkel's conservatives have said they want this initial privatization to be the first step toward selling off up to 49.9 percent of Deutsche Bahn. However, according to Beck, Monday's decision marked the "end point of the privatization."



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