Deutsche Telekom took out full-page advertisements in German newspapers yesterday to apologise to shareholders for the 20 per cent drop in share value last week.

The advertisements took the form of a letter from chief executive Dr Sommer, in which he said the Telekom board "deeply regretted" the losses.

He made no direct reference to the circumstances of the share plunge, which happened after Deutsche Bank traders sold 44 million Telekom shares on behalf of Hutchison Whampoa last week, only a day after analysts in the bank's research section issued a "buy" recommendation on the shares.

On news of the sale, shares plunged to their lowest value since November 1998, when around €20 billion was wiped off the company's share value.

In his open letter, Dr Sommer said it was important to concentrate on the medium- and long-term.

He said he hoped Telekom still had the trust of its shareholders, in particular the company's 3.5 million private shareholders.

The letter had little noticeable effect on the Telekom share price, still hovering around €19.70 in trading yesterday.

Yesterday's 5 per cent rise in value was more likely down to Goldman Sachs' adding of Telekom to its European Recommended List. The letter was a remarkable change of tone for the Telekom chief, who just days ago accused Deutsche Bank of having made "a grave professional error".

Mr Sommer told news magazine Der Spiegel that there would "certainly be consequences for our future business with Deutsche Bank" and did not rule out severing the company's ties with the bank.

Government regulators in Frankfurt have stepped in to investigate Deutsche Bank's trading in Telekom shares.

It also wants to determine whether this represented a breach of stock market regulations.

They have to determine whether Deutsche Bank analysts knew about the "buy" recommendation from their colleagues in the bank.

Criminal proceedings would follow if it was shown the bank tried to maximise its profits.