Deutsche Annington to list ahead of Terra Firma fundraise

Amy King
11 June 2013

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Deutsche Annington, the German real estate group backed by Terra Firma, has confirmed it will list on the Frankfurt Stock Exchange this year.

The news of an imminent divestment precedes an upcoming fundraise at Terra Firma, expected to occur this year, according to reports.

Around 25% of Deutsche Annington will be listed in the initial public offering, comprising new shares from a capital increase and secondary shares placed by Terra Firma. The IPO could raise as much as €1.2bn, including €400m from the new share issuance.

Proceeds from the sale will be used to strengthen the company's balance sheet.

The company has also appointed a new supervisory board, consisting of nine members, five of which were proposed by Terra Firma. Fromer E.ON CEO Wulf Bernotat has been appointed chairman.

JP Morgan and Morgan Stanley are acting as joint global coordinators and bookrunners.

Post-IPO, Deutsche Annington plans to refinance maturing debt with new loans, extending existing debt and potentially using other debt instruments including senior unsecured corporate bonds. As such, the company is soon to obtain a corporate investment grade rating from an international credit rating agency.

Terra Firma bought Deutsche Annington in 2001 for around €2bn, including an €833m debt package provided by KfW and Landesbank Hessen-Thüringen Girozentrale. In July 2012, Terra Firma agreed to a refinancing deal that included a €500m equity injection from the GP.