July 9 (Bloomberg) -- Deutsche Annington Immobilien SE, Germany’s largest residential landlord, is going ahead with an initial public offering that would raise about half the amount originally planned a week after postponing the sale.
Deutsche Annington, controlled by Guy Hands’s Terra Firma Capital Partners Ltd., plans to raise as much as 592.4 million euros ($763 million), the company said in a statement today. It had previously sought 1.1 billion euros.
“While the implementation of our operating strategy continues well on track, a successful IPO enables us to accelerate the diversification of our funding,” Chief Executive Officer Rolf Buch said in the statement.
Deutsche Annington, based in Bochum, postponed its IPO on July 2, citing adverse market conditions. The initial attempt failed because demand wasn’t strong enough, people familiar with the matter said at the time. The banks managing the revived deal, including JPMorgan Chase & Co. and Morgan Stanley, have enough demand for all the shares being offered, a person with knowledge of the matter said. The person asked not to be identified because the information is private.
“The pricing is now at a reasonable range and relatively more attractive than the peer group previously,” said Peter Papadakos, an analyst at Green Street Advisors in London.
The shares will be offered for 16.50 euros to 17 euros, Deutsche Annington said, compared with as much as 21 euros in the original range. The company aims to raise 412.1 million euros from the sale of new shares, 103 million euros from a secondary offering of shares and another 77.3 million in an overallotment, according to the statement.
While the size of the secondary offering has been reduced, Deutsche Annington is selling more new shares than planned. As a result, existing investors will see a greater dilution of their stakes, Papadakos said. The selling shareholders are offering 10.6 million shares, according to today’s statement. They originally planned to sell as many as 34.8 million.
Deutsche Annington would be the second German property company to list its shares this year. LEG Immobilien AG, a Dusseldorf-based competitor, raised about 1.3 billion euros in stock sale in February that was the largest in Germany’s real estate industry. The shares have since dropped by about 10.5 percent.
Deutsche Annington said 15.5 percent of the shares will be freely traded after the IPO, assuming investors buy all the stock available in the overallotment option.
The sale will be run through an accelerated bookbuilding process, Deutsche Annington said. The shares would begin trading July 11, the company said.
Deutsche Annington owns about 180,000 German apartments and has about 2,400 employees, according to its website. Terra Firma is a private-equity firm based in London.
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