Deutsche Bank (NYSE: DB) has settled its longest-running litigation over its 2008 takeover of Postbank, it said on Thursday.
The settlement with German investment company Effecten Spiegel includes an additional payment of 36.50 euros ($40.53) per share on the then-takeover offer price as proposed by the bank, Deutsche Bank added in a statement.
Shares in Germany’s largest bank rose to a day’s high and were up 3% at 1127 GMT.
In August, Deutsche Bank (NYSE: DB) said that it had reached settlements with more than half the plaintiffs, including the largest individual one, who accused the lender of underpaying in the acquisition of Postbank.
The bank also said it would reduce by 430 million euros the provisions it had set aside for potential future payouts, which will have a positive impact on third-quarter earnings.
In April, the bank said the total amount of the provisions could be up to the estimated full amount of claims of approximately 1.3 billion euros.
Deutsche embarked on its Postbank acquisition during the 2008 global financial crisis. Postbank, with millions of customers, has its roots in Germany’s postal system.
The deal aimed to broaden Deutsche’s reach in Germany and provide a steady domestic income stream after years of rapid international expansion, but Postbank became a source of consumer complaints, regulatory scrutiny, and costly lawsuits.
Effecten-Spiegel was the first of many to sue Deutsche Bank and for years was the sole plaintiff, saying in October 2010 that its decision was prompted by what it described as the lowball takeover offer.
Because of its specific role in the litigation, a refund of costs that accounts for the expenses in the long-running case has been agreed, Deutsche said.
($1 = 0.9005 euros)
(Source: Reuters)
