Deutsche Annington, Germany's largest residential real estate company, is taking a fresh stab at a stock market listing, albeit with lowered ambitions a week after its initial attempt failed.

The firm, majority-owned by private equity group Terra Firma, said yesterday its initial public offering (IPO) would seek to raise €575-592 million, compared with an original goal of up to €1.2 billion.

Terra Firma, led by British financier Guy Hands, has sharply reduced the number of shares it plans to sell, while the company is aiming to raise broadly the same amount as before from offering new shares in order to pay down debt.

After a strong start to the year, Europe’s IPO market has shown signs of faltering recently amid volatile equity markets and as jittery investors drive a hard bargain over price.

The bookbuilding process for Deutsche Annington’s share sale will likely end later yesterday, three people familiar with the placement said, with trading set to start on tomorrow.

“The books including greenshoe are covered,” one of the people said, referring to an optional chunk of shares that may be sold by Terra Firma depending on the level of demand.

For IPOs to be successful, bankers say demand needs to be at least twice as high as supply, while an indication that books are already covered can lead more investors to order the shares.

Deutsche Annington’s IPO comprises 34.8 million shares, or a 15.5 per cent stake in the company, including the greenshoe. It is aiming to sell the shares between €16.50 to €17 apiece, down from a previous range of €18 to €21.

The new range values the group, which owns 180,000 apartments, at up to €3.8 billion, well below its net asset value of €4.25 billion, and at a discount to many peers, which have been trading close to their net asset value.

Terra Firma will reap a maximum of €180 million euros from selling Deutsche Annington shares, compared with its original hope of raising more than €700 million. – Reuters