Germany's state-owned development bank has sold shares in the company that owns the national postal service for about 2.17 billion euros ($2.3 billion), reducing the government's stake and raising money to help finance improvements to the country's rail network.

FORMER HEAD OF GERMANY'S DOMESTIC SPY AGENCY FACES SCRUTINY FOR ALLEGED EXTREMISM

The KfW bank, which holds the government's remaining stakes in previously state-held companies, said late Tuesday that it had sold 50 million shares of Deutsche Post — the name under which it still trades on the stock exchange, although the company is now known as DHL Group — at 43.45 euros each. That amounts to 4% of the company's shares.

The sale cuts the state's stake in DHL to 16.5%, though it is still the largest single shareholder. The proceeds are to be used to strengthen the capital of Germany's main railway operator, the state-owned Deutsche Bahn, to help it upgrade railway infrastructure, the Finance Ministry said Wednesday.

The government is turning to privatization proceeds to help finance improvements to the rail network after a court ruling forced it to plug a big hole in this year's budget and reconsider its wider financial plans.

In November, Germany's highest court annulled a decision made by the government in 2022 to repurpose 60 billion euros originally meant to cushion the fallout from the COVID-19 pandemic for measures to help combat climate change and modernize the country. The maneuver ran afoul of Germany’s strict self-imposed limits on running up debt.