German real estate company OfficeFirst Immobilien will hold off launching another attempt at a stock market flotation until the European spring of next year, several people familiar with the matter said.
Two weeks ago, a first attempt to list OfficeFirst failed as not enough buyers were willing to muster the 21 to 23 euros per share bankers were asking, in what would have been the second-biggest German flotation this year, with a volume of 888 million euros ($974 million).
Three people told Reuters that OfficeFirst’s owners had initially considered having another go at an initial public offering (IPO) at a much smaller volume this month, but ultimately decided against it.
OfficeFirst’s parent IVG has also rejected a renewed offer by U.S. financial investor Blackstone, which the people said would have been comparable with the expected proceeds from an IPO.
In September, Blackstone had initially put up 3.3 billion euros ($3.62 billion) including debt, but IVG turned it down.
IVG, which went through insolvency proceedings in 2013 and is since owned by hedge funds – including York Capital, Anchorage and Davidson Kempner – might now consider a listing at a later point, with owners hoping to profit from higher prices following the initial listing.
“The stock market launch should therefore be completed in the first half of 2017, maybe in January but more likely in March or April,” one of the people said. “There is no reason to make a hasty decision.”
IVG declined to comment but reiterated that an IPO remained the preferred option.
“We are also considering all other opportunities, however,” an IVG spokesman said.
OfficeFirst initially wanted to generate enough proceeds to pay off 335 million of its 1.9 billion euros in debt.
Experts are undecided on whether a listing next year would be more successful and OfficeFirst, owner of the landmark The Squaire office complex at Frankfurt airport, is now looking at an expensive bridge loan.