<article>The clock is ticking for John Cryan to complete the next step in Deutsche Bank AG’s turnaround.</article>

The clock is ticking for John Cryan to complete the next step in Deutsche Bank AG’s turnaround.
The lender on Monday said it will sell shares in its DWS asset management business “in the earliest available window,” confirming a plan first outlined a year ago and kicking off what is usually a four-week run-up to the initial public offering. Deutsche Bank didn’t indicate how much it plans to raise, though people familiar with the plan said the lender expects to sell a 25 percent stake that could be valued at 1.5 billion euros ($1.85 billion) to 2 billion euros on an exchange.
A successful offering, just weeks after a spike in stock market volatility, would mark an important achievement for Deutsche Bank CEO Cryan, who proposed the IPO in March last year to help bolster capital amid investor concerns about the lender’s financial strength. It would also give the business more independence and flexibility for acquisitions at a time when firms are under pressure to consolidate following an investor flight to cheaper passive funds.
“While Deutsche Bank is selling part of its crown jewels, the flotation also gives greater flexibility to DWS and could be positive for the unit,” said Philipp Haessler, an analyst with Equinet Bank AG in Frankfurt.
Deutsche Bank expects DWS, which has about 700 billion euros under management, to be worth between 6 billion euros and 8 billion euros once it trades, people familiar with the matter said. That would be in line with Amundi SA, which has twice the amount of assets and a market value of 13.7 billion euros.
Companies typically sell shares at a discount to their target valuation to lure buyers, so the bank may end up raising less than 2 billion euros.
Shares of Deutsche Bank rose 0.6 percent to 13.37 euros by 1:40 p.m. in Frankfurt. The stock is the worst performer this year among the 43 members in the Bloomberg Europe 500 Banks and Financial Services Index, with a decline of 16 percent.
Deutsche Bank tried to sell much of the asset management unit in 2012, but stopped when it couldn’t get enough money. Now the business is targeting net inflows of 3 percent to 5 percent of assets a year, a number that may be difficult to reach after several key funds saw recent outflows, according to Stuart Graham at Autonomous Research.
DWS is going public “with a punchy net new money target just when some of its key high margin funds have moved into outflow,” Graham wrote in a note. “So we can’t see this being a ’hot’ IPO and we would expect prospective investors to be very price sensitive.”
Amundi, which is controlled by Credit Agricole SA, has become Europe’s largest asset manager since going public in 2015, helped by acquisitions. Moreau said while DWS won’t get any proceeds from the IPO, it has excess capital that it can use for growth or to return to shareholders. The bank could also use the IPO to attract large investors who could help it expand.
It’s “too early to say whether we’ll have anchor investors,” Nicolas Moreau, who runs the business, said in an interview. “But if there’s an investor who brings us strategic advantages such as exposure to countries or clients where we’d like to grow, then that’s something that could be good.”
Cryan said in November that he aims to complete the IPO by the end of the first quarter. Although the formal announcement of an IPO intention does not impose any legal requirements, it typically ushers in a two-week period in which a company holds talks with potential investors to settle on a price range for its shares. In the following two weeks, the company usually takes orders from investors in what is called the book building.
Bloomberg

Deutsche Bank expects to sell a 25% stake that could be valued at 1.5 billion euros ($1.85 billion) to 2 billion euros on an exchange.

Deutsche Bank lines up IPO of asset management unit DWS

Bring stories like this into your inbox every day.

Sign up for our newsletter - The Daily Brief

Deutsche Bank lines up IPO of asset management unit DWS

Start your deal-making journey now!

Bring stories like this into your inbox every day.

Sign up for our newsletter - The Daily Brief