The Japanese government is set to raise ¥416 billion (US$4 billion) from the initial share sale of state-owned Kyushu Railway Co after pricing the stock at the top end of a marketed range.
The shares are to be sold at ¥2,600 each, compared with the ¥2,400 to ¥2,600 range offered, according to a filing yesterday.
Japan is selling all 160 million shares held by Japan Railway Construction, Transport and Technology Agency, which fully owns JR Kyushu.
The initial public offering (IPO), set to be the world’s third-biggest this year, is part of Japanese Prime Minister Shinzo Abe’s efforts to encourage people to invest some of their ¥1,700 trillion household savings in the stock market.
JR Kyushu’s initial public offering follows debuts in the 1990s by East Japan Railway Co and Central Japan Railway Co after the breakup of state-run Japan Railways in 1987.
Shares of JR Kyushu, which operates bullet trains, hotels and restaurants on Japan’s Kyushu, are scheduled to be listed on Tuesday next week in Tokyo and the following day in Fukuoka.
Three-quarters of the shares are being sold domestically, with the rest offered to overseas investors. Japan aims to sell more than half the shares to individual investors and held eight of 10 investor presentations on Kyushu.
Nomura Holdings Inc, Mitsubishi UFJ Morgan Stanley Securities Co and JPMorgan Chase & Co are global coordinators for the initial public offering, while SMBC Nikko Securities Inc and Goldman Sachs Group Inc are to lead the global offering.
JR Kyushu, which gets most of its profits from real estate and station-building businesses, is the fourth of the JR firms selling shares to the public. The shares are to list on the first section of the Tokyo Stock Exchange, one of five markets it operates and where most large companies are listed, according to the Japan Exchange Group.
The company has proposed a dividend of ¥37.5 for the six months through March and is offering fare discounts to potential investors to help boost demand for the offering. JR Kyushu predicts net income of ¥38.2 billion in the year ending March 31, with sales forecast to increase 0.2 percent to ¥379 billion.
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