The Coming Week in Europe: Bertelsmann Unit Pixelpark Launches IPO

Also, the European Central Bank will hold its monthly press conference on Thursday to discuss monetary policy.
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BERLIN -- Following the announcement that Germany's pre-eminent author

Gunter Grass

has won this year's

Nobel Prize

in literature, it is perhaps fitting that the German media sector will figure prominently in the financial headlines next week.

Much of the focus will be on the initial public offering of the Berlin-based online services firm

Pixelpark

, which is owned by Germany's global media powerhouse

Bertelsmann

. Bertelsmann says the Pixelpark IPO on Monday will be only the first in a series of strategic listings to enable its various subsidiaries to embark on an aggressive round of acquisitions and growth.

Pixelpark, which designs Web sites and offers online expertise to large corporate clients such as

Deutsche Telekom

(DT) - Get Report

and the

New York Museum of Modern Art

, is hoping to raise upwards of 60 million euros ($63 million) by selling its shares for an initial price of between 12 and 15 euros. Only 20% of the shares will float on the

Neuer Markt

-- Germany's answer to the

Nasdaq

-- while Bertelsmann will hold 60% and Paulus Neef, Pixelpark's founder and chairman, will retain the remaining 20%.

While Pixelpark's stated intention to make rapid acquisitions both domestically and abroad should be enough to pique investors' interest in the multimedia sector, the recent assertion by Bertelsmann Chairman Thomas Middelhoff that strengthening the company's Internet operations is a priority should really get their juices flowing, principally because Bertelsmann owns a large chunk of

barnesandnoble.com

(BNBN)

.

Not only does Middelhoff have ambitious plans to grow the Bertelsmann empire, but he also wants to speed up changes in Germany's corporate culture. The drones slaving away in Europe's multimedia industry will no doubt be overjoyed to hear claims from Neef and Middelhoff that both the Pixelpark and future Bertelsmann listings will incorporate employee-incentive programs that mirror those in the U.S. in order to attract quality workers.

"Our first goal is to bind all current and future employees to the firm by means of a stock-options program, thereby increasing the attractiveness of the company worldwide," Neef said in a recent interview.

Away from the equity markets, the

European Central Bank

will hold its monthly press conference on Thursday to discuss monetary policy. No change in interest rates is expected, but ECB President

Wim Duisenberg

may be called on to elaborate on ECB Vice President

Christian Noyer's

slightly hawkish rumblings last week.

"Recent comments by Noyer throw up chances of an

early ECB rate hike,

but we are sticking to our view that a hike early next year is still the most likely outcome," says Joachim Fels, an economist for

Morgan Stanley Dean Witter

in London.

Among the most interesting economic data for Europe's monetary authorities to mull over next week are the reports for August on German manufacturing orders Wednesday and German industrial production Thursday. Both are expected to show further recovery in Europe's largest economy.

In the political arena, France's parliament will debate the implementation of a mandated 35-hour workweek on Tuesday, a day after employers will take to the streets to protest the measure and French unions will no doubt mount equally vigorous counterdemonstrations.

Well aware of the zest his countrymen put into their protests, French President

Jacques Chirac

will avoid the whole hullabaloo by traveling to Madrid for an official state visit to Spain on Monday. Perhaps he might read Grass'

The Tin Drum

on the plane over.