Deutsche Annington postpones IPO

German residential landlord Deutsche Annington has postponed its initial public offering planned for July 3, citing 'persistent adverse market conditions'.

The company, which is 85%-owned by private equity firm Terra Firma, said its market debut would be delayed but did not give a new date for the IPO.

Market rumours suggest the listing was cancelled because the company failed to attract enough demand for its new shares, which were priced at a range of €18-21 a share.

London-based Terra Firma intended to list Deutsche Annington shares on the Frankfurt stock exchange, in an operation expected to raise €1.1-1.4 bn. The proceeds from the operation were aimed at repaying the company's commercial mortgage-backed security, German Residential Asset Note Distributor (GRAND) by October.

Issued in 2006 for €5.8 bn, GRAND was the largest CMBS in Europe at the time. About €3.8 bn remains outstanding.

Launched in 2001, Deutsche Annington is the owner of 180,000 residential units across Germany.

'This decision doesn’t impact Deutsche Annington’s strategy,' chief executive Rolf Buch said. 'We will focus on driving our operational performance including continuing our investment and modernization program as planned.'

JPMorgan Chase & Co and Morgan Stanley were leading the Deutsche Annington offering.

Deutsche Annington would have been the second German property company to list its shares this year, after LEG Immobilien raised over €1.3 bn in February.

Düsseldorf-based LEG Immobilien pulled off the second-largest German IPO in five years, with shares priced in the middle of the expected range at €44. The deal was around four times oversubscribed. LEG was sold by Goldman's Whitehall property funds and New York-based hedge fund Perry Corp which each held 89% and 11%.

Austria's Immofinanz is also considering an initial public offering of its Buwog residential property arm in the future.