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Derivatives

Deutsche Bank Opens Faucet For First Water Equity Basket

Deutsche Bank's equity derivatives group in London is structuring a product that will allow discretionary account holders to take on exposure to a basket of listed and privately held water companies, in what is believed to be the first product of its kind. Shachi Shah, v.p. global equity derivatives in London, said the payout will be based on an index of water companies, which her department is currently drawing up. The firm expects to raise approximately EUR100 million (USD88 million) for the product when it goes live within three months. Shah declined all comment on how the product will be structured.

The German bank is putting the product together now to take advantage of an expected uptick in mergers and acquisitions and privatizations in the water sector. Most of the water markets in Europe and the Middle East are in public hands and these likely will eventually be privatized, Shah added.

Rival equity derivatives players said they were unaware of Deutsche Bank's plans and had not heard of similar products hitting the market.

 

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