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WestLB prepares to sell HSH Nordbank stake

German bank WestLB is in advanced talks to sell its 27% stake in HSH NordBank to private sector investors, the Financial Times has reported.

Finance houses Hellman & Friedman and JC Flowers are understood to be entering the final stages of due diligence on HSH Nordbank, one of Germany’s biggest state-owned wholesale banks, the newspaper reported without citing its sources.

Cerberus and Corsair are also looking, but are at a less advanced stage.

Although the stake has been valued at E1.5 billion, the newspaper claims that it has a much larger symbolic value because it would be the first time private investors had acquired a stake in one of the country’s state-backed banks that dominate German banking.

HSH Nordbank’s other owners, which include the city of Hamburg, the state of Schleswig-Holstein, and the Savings Banks and Giro Association of Schleswig-Holstein, are offered first refusal to buy WestLB’s stake if they match a binding offer within four weeks of it being made, the report said.

HSH Nordbank, which is one of the world’s leading providers of ship finance, has assets of about E165 billion and employs 4,500 staff.