The 2,500 Irish investors who bought shares in Deutsche Telekom this year will be heartened to hear of the more favourable outlook now predicted for the group.
This week analysts stated its interim figures showed positive signs for the rest of the year with the sale of its cable television activities expected to make an enormous contribution to profits in the second half of 1999.
The deadline for bids for the cable company closed last week and Deutsche Telekom chairman, Mr Ron Sommer, said it would take several weeks to evaluate the offers. Mr Sommer said the preliminary outcome of the bidding process was "very positive and fits in perfectly with its expectations". Deutsche Telekom is hoping to receive around €10 billion (£7.9 billion) from the sale. Chief financial officer, Mr Joachim Kroeske, said that income from the sale had already been taken into account in the projects for full-year earnings and sales.
Deutsche Telekom is planning to hold on to a stake of 25 per cent plus one share in the cable business which is being carved up into nine regional groups. But a complete sale of one of the companies would not be ruled out "if the price is suitable". The bidders include Deutsche Telekom's arch rival, Mannesmann, a unit of Deutsche Bank called DB Investor and an Anglo-US consortium headed by London-based Callahan Associates.
Deutsche Telekom's half-year figures showed a decline in both sales and earnings resulting from the price war in the liberalised German telecoms market. But the brighter outlook has boosted the shares.
