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UPDATE 2-German property developer Instone looks at share listing next year
November 22, 2017 / 11:03 AM / a month ago

UPDATE 2-German property developer Instone looks at share listing next year

* Instone eyes options, including IPO or private placement

* IPO could value company at 700-800 mln euros - sources

* IPO expected to take place in first half of 2018 - sources

* Deutsche Bank, Credit Suisse advising - sources (Adds peers, deal value)

FRANKFURT, Nov 22 (Reuters) - German residential property developer Instone Real Estate is considering a stock market flotation next year to raise funds for growth which could value the company at as much as 800 million euros ($940 million).

“Jointly with our owner Activum SG we are examining various strategic financing options,” Instone said in a statement on Wednesday, adding that those could include an initial public offering or a private placement of shares.

The company is working with Deutsche Bank and Credit Suisse on a transaction which may value the company at roughly 700 to 800 million euros, people close to the matter said, adding that a deal is expected to take place in the first half of 2018.

As a real estate developer, it is less directly comparable with German property groups such as Vonovia or Deutsche Wohnen which own and rent out flats. It has more in common with companies such as Ireland’s newly-listed Glenveagh Properties and Spain-based Neinor Homes .

The banks declined to comment.

Germany has seen relatively few IPOs this year, but investment bankers have put that down to a dearth of companies at that stage of development rather than a lack of investor appetite.

Reuters had reported in September that Instone was considering a stock market flotation.

Instone was formed by a merger of Formart, a former unit of German builder Hochtief which specialist real estate investor Activum bought in 2014 for roughly 300 million euros ($353 million), and peer GRK.

Instone also said it has acquired property in Hamburg and Munich, boosting the its portfolio of real estate projects to 3.4 billion euros.

The company is hoping to benefit from Germany’s buoyant housing market. According to statistics published on the Bundesbank website, residential property prices in 127 large German cities have surged 41.4 percent between 2011 and 2016. ($1 = 0.8514 euros) (Reporting by Arno Schuetze; Editing by Maria Sheahan and Keith Weir)

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