Franco-German defence group KNDS is struggling to convince investors to back its planned initial public offering at a valuation of over €12 billion, the Financial Times reported on Tuesday.
Some investors have told KNDS in preliminary talks that they believe the company would be worth less than €12 billion in the IPO planned for July, the report said, citing people familiar with the matter.
Reuters could not immediately verify the report. KNDS did not immediately respond to a request for comment.
KNDS's key German family shareholder made it clear that it will not proceed with an IPO at a valuation below €12.5 billion, the report added.
KNDS and its advisers are still hopeful that enough investors will back an IPO at the desired price, the report said, adding that investors are incentivised to push for low prices in pre-listing talks and could yet commit to invest at a higher valuation.
KNDS said last week it planned to list its shares in Frankfurt and Paris, marking the first step of the company's planned IPO.
KNDS is owned through a 50-50 split between the French government and the German family owners of former Krauss-Maffei Wegmann (KMW), who plan to sell their stake. KMW was merged with France's Nexter into KNDS.