Shurgard, Europe’s largest self-storage company, has priced its IPO at the bottom of its target range as it navigates a difficult European flotation market in the wake of a global equity sell-off.

The company priced its shares at €23, at the bottom of its original €23 to €28 target range, putting it on track for a market capitalisation of €2.04bn when it lists on Euronext Brussels next week. Earlier this month it said it would seek a market valuation of up to €2.4bn.

Shurgard’s listing follows tremors in equity markets over recent days, which prompted the Dutch car leasing group LeasePlan to call off its initial public offering on Thursday.

Other companies have made underwhelming debuts on European markets in recent weeks, with Aston Martin and Funding Circle in the UK both trading more than 10 per cent below their debut prices.

Shurgard’s IPO will be made through a private placement with institutional investors. The company said it would raise up to €575m, representing 28 per cent of the total shares. Net proceeds from the issue would be about €550m, it added.

Shurgard said it would use the capital raised to strengthen its position in urban areas across Europe, where it specialises — in particular London, Paris and Berlin. The Luxembourg-based company, which rents self-storage lockers, has had a good run in Europe, where urbanisation, a more mobile population, changing trends in household formation and a decline in residential space have boosted demand.

The proceeds of the listing will also be used to repay loans, including a €200m bridge loan, and to finance the acquisition of a store in Kensington this month, the company said.

Chief executive Marc Oursin said the company was “very pleased with the results of the global offering”.

Shurgard said it expected net profits of at least €95m in 2018, which even after pricing at the low end of the range give the stock a price-to-earnings ratio of around 21. That is above the PE ratios of its UK rivals, Big Yellow Group and Safestore, which are around 20 and 18 respectively.

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