UPDATE 1-Talanx says to raise at least 467 mln euros in IPO
* Shares to be priced at 18.30 euros each
* Deal will raise 517 mln euros if greenshoe exercised
* Share price values company at 4.6 bln euros
* About 11 pct of shares freely traded if greenshoe exercised (Adds details, background)
FRANKFURT, Oct 1 (Reuters) - Talanx, Germany's third-biggest insurer, said on Monday it will raise at least 467 million euros ($603 million) in an initial public offering, in a sign that Europe's fragile IPO markets are regaining strength.
Talanx said it plans to sell shares for 18.30 euros apiece. It surprised investors two weeks ago by reviving scrapped plans for the share sale. Interested parties could bid between 17.30 euros and 20.30 euros per share.
The offer price values the whole company at 4.6 billion euros, said a spokesman. Trading of the shares, which are all newly issued, will start on Tuesday
The listing is the first big initial public offering in Germany since the flotations of engineering group Norma and property group GSW last year. Several hopefuls, including chemicals group Evonik and car parts maker KSPG, recently scrapped their IPO plans.
Talanx said it might sell an additional 2.7 million shares in a so-called greenshoe option on top of the 25.5 million shares it is selling in the flotation, which would raise the gross proceeds to 517 million euros. About 11 percent of Talanx shares will be freely traded if the greenshoe option is fully exercised.
The Hanover-based insurer surprised investors on Sept. 20 by reviving flotation plans it had cancelled only a week before, when potential investors balked at the price it wanted.
Talanx at the time blamed its banking consortium for overestimating investors' willingness to pay when it realised that investors were valuing the group at no more than its 50.2 percent stake in Hannover Re, the world's third-biggest reinsurer, along with recently acquired operations in Poland and the cash raised in the flotation.
Talanx then capped the funds it plans to raise in the IPO at 500 million euros, down from 700 million. This will give Talanx a free float of about 12 percent.
The stake of the current 100 percent shareholder, HDI V.a.G., will be diluted to about 83 percent.
Japanese strategic partner Meiji Yasuda Life Insurance will convert at the IPO issue price a 300 million euro subordinated bond held since November 2010 into equity, giving it a stake of 6.5 percent.
Talanx also weeded out J.P. Morgan and Citigroup from the list of joint global coordinators, retaining Deutsche Bank and elevating Berenberg Bank, which according to sources close to the transaction promised to place all shares at an enterprise value of at least 4.5 billion euros.
Talanx has said it will use the cash raised in the IPO to finance growth, particularly in industrial insurance and in emerging markets, as well as to repay loans linked to recent acquisitions in Poland. ($1 = 0.7749 euros) (Reporting By Peter Dinkloh and Arno Schuetze; Editing by Gary Hill and Leslie Adler)
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