KARLSRUHE/MONTABAUR (dpa-AFX) - Internet service provider and telecoms group United Internet will have to settle for a lower valuation than previously thought for the planned IPO of its hosting subsidiary Ionos, according to insiders. United Internet and co-owner Warburg Pincus expect a valuation of up to 3.4 billion euros for the initial public offering (IPO), the Bloomberg news agency reported Friday, citing people in the know. United Internet and the financial investor were reportedly looking to gross up to 500 million euros from the sale of around 15 percent of the shares. In December, the news agency Bloomberg had reported that United Internet was hoping for a total valuation of up to five billion euros.

United Internet and Warburg Pincus declined to comment on the information when asked by Bloomberg. United Internet, led by chief executive and major shareholder Ralph Dommermuth, holds around three quarters of the shares in Ionos, with Warburg Pincus holding the rest. Ionos hopes the IPO will accelerate growth and strengthen its brand. The company is aiming for an IPO on the Frankfurt Stock Exchange in the first quarter. At the initial listing, existing shares held by the owners are to be sold to investors. After the IPO, the parent company intends to continue to hold a majority stake in Ionos./men/stw/mis