Shares in United Internet AG’s web hosting arm Ionos SE dropped following the company’s debut on the Frankfurt Stock Exchange, the first test of the German exchange this year.
(Bloomberg) — Shares in United Internet AG’s web hosting arm Ionos SE dropped following the company’s debut on the Frankfurt Stock Exchange, the first test of the German exchange this year.
Ionos fell to €17.54 at the close in Frankfurt on Wednesday. That compared with a 0.3% gain in the Stoxx Europe 600 Index.
The company priced its shares at the bottom end of an initial range at €18.50 apiece, raising €389 million ($418 million) and giving it an initial valuation of €2.6 billion. That’s about half of what Ionos had originally targeted.
Read More: Ionos IPO Raises €389 Million After Pricing at Bottom-End
It’s the first major listing in Germany since Porsche AG’s launch last September after investor concerns about the economy discouraged new share sales. Globally, the number of listings last year fell by almost half, according to data compiled by Bloomberg.
“Price movement is a bit of a puzzle today,” said Patrick Basiewicz, an analyst at broker Finncap, in an interview. “Ionos was priced to clear, and if that cannot get a nice bump on day one, other IPOs are in trouble.”
A representative for Ionos didn’t immediately respond to a request for comment on the share move.
Technology companies have been hit particularly hard by increasingly cautious investors, who have sent share prices and valuations down, triggering a wave of cost cuts and job eliminations. Still, Ionos’s publicly traded peers GoDaddy Inc. and Squarespace Inc. have seen their shares rise 12% and 3.3%, respectively, this year.
Read More: Dell Joins Tech Companies in Slashing Jobs to Cope With Slowdown
Ionos, which focuses on small and medium-sized enterprises in Europe and North America, also runs a fast-growing cloud business that competes with firms including France’s OVH Groupe SAS and New York-listed DigitalOcean Holdings Inc.
(Updates with closing share price in second paragraph.)
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