Deutsche Bahn, govt to mull IPO price range Thurs: sources

FRANKFURT/BERLIN (Reuters) - Deutsche Bahn will get an initial indication of the price range for its planned share flotation on Thursday, allowing a decision to be taken on whether to go ahead with the IPO amid the financial market turmoil, banking and government sources familiar with the situation said.

Bahn executives are also due to meet with the government steering committee for the IPO on Thursday to discuss the price range and analyze the potential proceeds for the public purse, a government source said on Tuesday.

Deutsche Bahn and the Transport Ministry declined to comment, but doubts about the timing of the part-privatization of the rail operator, which would be Germany's biggest flotation in eight years, have grown amid the sharp falls in share markets around the world.

German Finance Minister Peer Steinbrueck on Monday also questioned the launch of the Bahn's transport, logistics and service business unit, now set for October 27.

"At some point one has to consider whether now is the right time," he said.

A Deutsche Bahn spokesman said earlier this week that there had been no negative signs from the market so far and that investors were looking for safe assets.

Sources from the banking consortium handling the IPO have said that investor interest is broad-based and sustained but that bidders are likely to demand a price discount because of the financial market ructions.

Analysts have scaled back estimates of what they expect the IPO to raise to around 5 billion euros ($6.8 billion), from as much as 8 billion euros originally.

Since announcing the IPO date on September 26, Deutsche Bahn had been adamant the IPO would go ahead in October as planned. The subscription period for the IPO is due to start on Monday.  Continued...