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KfW sells 110 million shares in Deutsche Telekom for $2.7 billion

FILE PHOTO: German Telekom CEO Hoettges attends the annual results news conference in Bonn

BERLIN (Reuters) - German state lender KfW has sold 110 million shares in Deutsche Telekom for 2.5 billion euros ($2.7 billion), it said on Monday, as part Berlin's plans to sell holdings in companies to invest in the country's rail network.

The shares - equivalent to a 2.2% stake in the telecoms group - were sold at 22.13 euros each. Deutsche Telekom shares closed at 22.64 euros.

Following the sale, KfW and the government hold around 27.8% of the telecoms company, Germany's Finance Ministry said late on Monday, adding that stake would remain stable going forward.

"The federal government will use the net proceeds from the transaction to strengthen the equity of Deutsche Bahn AG and to expand the rail infrastructure in Germany in a forward-looking manner," the ministry said.

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Share sales so far this year have reached the highest level in Europe, the Middle East and Africa since a record year in 2021, according to Dealogic.

In February, KfW sold 50 million shares in logistics firm DHL for 2.17 billion euros.

The German government plans to raise up to 4 billion euros by selling company shareholdings this year, finance ministry documents previously seen by Reuters show.

($1 = 0.9184 euros)

(Reporting by Emma-Victoria Farr in Berlin, Shivani Tanna in Bengaluru and Christoph Steitz in Frankfurt; Editing by Vijay Kishore, Mark Potter and Bill Berkrot)