Japan Post announces launch of long-awaited IPO in Tokyo


AFP

TOKYO–Japan Post on Friday confirmed a long-awaited plan to list its shares in Tokyo with the government-owned firm set for what could be one of the world’s biggest share sales. The parent company, along with its insurance and banking units, would launch an initial public offering (IPO) in the middle of the 2015 fiscal year, which begins in April, but executives declined to comment on the size of the initial sale. Plans for the IPO come amid hopes starting to privatize what is effectively the world’s biggest bank could boost investor sentiment and spur efforts to cut red tape in Japan’s highly regulated economy. Company executives said much as 50 percent of the holding company and its financial units could ultimately be sold off, with Bloomberg News reporting that its combined market capitalization may reach 8.0 trillion yen (US$67 billion). Japanese media earlier said the size of the sale could ultimately rival that of mobile phone giant NTT Docomo’s seven trillion yen IPO in 1998, the country’s biggest share sale to date. Japan Post’s chief executive Taizo Nishimuro said Friday that finance minister Taro Aso had signed off the IPO plan, but added that the sale’s timeline would be decided ��after consulting with relevant ministries and brokerage firms.�� He added that there was no set deadline to sell off as much as half of the sprawling company which has a network of some 24,000 bureaux across many of the thousands of islands that make up the Japanese archipelago, and sits on assets worth up to 14 trillion yen.

��We have to consider market trends and various other factors �X at this point, there is no concrete date,�� Nishimuro told reporters in Tokyo on Friday. The group’s mail-delivery unit will likely remain untouched amid social and political pressure to maintain the status quo, including the presence of post offices across the nation, even in the most remote villages. The branches also offer services for cash deposits and insurance, and a local branch where many of Japan’s ageing retirees withdraw their pension payments. That system has long drawn criticism both inside and outside Japan, with financial institutions, carrier services and foreign governments arguing that the public body was operating in sectors where it competed directly with private businesses. The government of former Prime Minister Junichiro Koizumi split the state-owned behemoth into four units in 2007, to handle deliveries, savings, insurance and counter services at each of its post offices. The government retained full ownership of the group at first, with plans for the bank and insurance units to go fully private by 2017. But the plan was stalled after the long-ruling Liberal Democratic Party lost power to the Democratic Party of Japan between 2009 to 2012. After returning to power in 2012, the current LDP-led government has resumed privatization project.