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LONDON\/FRANKFURT: Shares in German web hosting company IONOS<\/a> fell roughly 5% on their stock market debut on Wednesday in a sign investors remain wary of companies going public after a prolonged freeze.
The shares started trading below the issue price through the first day of trading on the Frankfurt Stock Exchange<\/a> and closed at 17.54 euros.
The initial public offering was priced on Tuesday at 18.50 euros per share, the bottom of the company's target range.
\"This won't be the last IPO this year, though the environment remains challenging,\" said Thomas Book, a member of the executive board of Deutsche Boerse, which operates the Frankfurt exchange.
The listing of IONOS, whose closest peer is U.S.-based GoDaddy<\/a>, was seen as a test of investor appetite after IPO activity all but ground to a halt in 2022 as the global economy slowed amid soaring inflation and energy prices.
It is Europe's first major flotation since Porsche's blockbuster debut in September.
\"I am sure that the price will reach the right level in the long run,\" IONOS Chief Executive Achim Weiss told Reuters at the trading venue.
The offering was oversubscribed multiple times at the bottom of the proposed valuation range.
The deal saw demand from money managers, including hedge funds, as well as domestic retail investors, sources close to the matter said.
The deal piqued the interest of a significant number of investors, with roughly 750 meetings set up to market the IPO, one source said.
However, fund managers expected an \"icebreaker\" discount to buy into the first deal of the year.
IONOS parent United Internet<\/a> and minority shareholder Warburg Pincus could make as much as 447 million euros from the flotation.
Underwriters for the deal may use an \"over-allotment\" option to sell additional shares, giving the company a free-float of 17.3%.
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