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Spain's Aedas Homes wobbles on debut in first listing since Catalan crisis
October 20, 2017 / 2:09 PM / in a month

Spain's Aedas Homes wobbles on debut in first listing since Catalan crisis

MADRID, Oct 20 (Reuters) - Spanish housebuilder Aedas Homes wobbled on its market debut on Friday in Madrid’s first equity offering since a secession bid by the wealthy Catalonia region sent shockwaves through the euro zone’s fourth-largest economy.

In a test of investor appetite for Spanish assets, the stock dropped over 6 percent in early trading, but later rallied to trade around 1.6 percent below its listing price.

Madrid-based Aedas went ahead with the listing despite political turmoil which has rattled financial markets since early September, when Catalonia legislated to form a republic, prompting the central government to move towards direct rule.

Almost 1,200 companies have moved their legal headquarters out of Catalonia as the situation became more volatile, and Barcelona-based real estate firm Inmobiliaria Colonial decided last week to relocate to Madrid.

Real estate firms are particularly vulnerable to the slowdown in investment caused by the standoff, said Jose Lizan, a fund manager at Auriga Global Investors, although the impact on Aedas would be limited to the more than 15 percent of its land located in Catalonia.

“You can’t move these assets, it’s much more complicated than a factory or a bank that changes its headquarters,” Lizan said.

A 31.65 euros ($37.34) listing price struck earlier this month valued the company at about 1.52 billion euros ($1.79 billion). After an initial slump on Friday, shares recovered to trade at 31.13 euros at 1341 GMT.

It was the second real estate company to go public in Spain this year, after Neinor Homes which in March became the first residential builder in a decade to list in Madrid.

Neinor’s listing confirmed that residential construction in Spain was coming back to life nine years after a property crash devastated the economy and financial system. Its shares were trading 3.7 percent above their listing price on Friday.

Aedas has a large portfolio of land but has as yet sold no properties. Its main shareholder, U.S. investment firm Castlelake, could reduce its holding to 51.6 percent if a greenshoe over-allotment option is exercised after the IPO. ($1 = 0.8476 euros) (Reporting by Isla Binnie and Andres Gonzalez in Madrid and Nadiia Karpina in Gdynia; Editing by Adrian Croft)

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