Germany's Domicil postpones IPO amid 'difficult market conditions'

German property company Domicil Real Estate has postponed plans to float on the Frankfurt stock exchange, blaming an unfavourable market environment as a result of uncertainty surrounding Brexit.

In a statement on Wednesday, the Munich-based residential specialist said that it is postponing its IPO plans for the time being but added that it will 'observe the capital market environment and implement its flotation plans as soon as the market proves to be more favourable'.

'We met with considerable interest and received very positive feedback on our business model from investors,' said Khaled Kaissar, CEO of Domicil Real Estate, 'but have decided to postpone the planned initial public offering until a later point in time in view of the current difficult market environment.'

The difficulties stemmed from the country of origin of several investors, a company spokesperson told PropertyEU. 'As many investors are located in the UK or connected to the British finance sector, ongoing uncertainty in the Brexit process resulted in some restraint to carry out investments at all,' the Domicil spokeswoman said.

The company announced in early October that it planned to raise €150 mln via an initial public offering in Frankfurt. Domicil said that it had won the backing of insurance companies Signal Iduna and Die Bayrische, who have between them agreed to invest €15 mln in the offering.

The company planned to use the proceeds to fund its growth.

Domicil posted revenues of €366.6 mln in 2018, thereof €346.0 mln from the sale of real estate. In 2018 Domicil posted earnings before interest and taxes (EBIT) of €29.9 mln and a net annual profit of €12.2 mln.

The offering was due to take place before the end of this year subject to market conditions, the company said.


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