IPO ENVY. Leonardo is sitting out a stock market frenzy. The state-controlled Italian defence company on Wednesday postponed its listing of U.S. naval systems and satellite communication unit DRS. Boss Alessandro Profumo launched the offering of a 22% stake in mid-March at between $20 and $22 a share. At the top of that range DRS would have been valued at $3.2 billion – more than half its parent’s market capitalisation – while bringing in $700 million in cash. Leonardo blamed “adverse market conditions”, which is surprising as U.S. markets are flush with initial public offerings and special-purpose acquisition companies. Investors appear to have demanded a too-low valuation for the unit, with too much demand coming from short-term hedge funds. Shareholders who had been anticipating a boost to Leonardo’s valuation, and a reduction in its 3.3 billion euro net debt pile, knocked 6% off the Italian company’s shares on Wednesday morning. Though Leonardo may try again later, the IPO market can hardly improve. (By Lisa Jucca)