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 The government aims to sell at least 1.3 trillion yen ($11 billion)
worth of shares, the sources said, in the first tranche of a
three-part sale aiming to raise around 4 trillion yen over the
coming four to six years to fund reconstruction from Japan's 2011
earthquake and tsunami disaster.
The mammoth IPO, a decade in the making, reflects Prime Minister
Shinzo Abe's push to invigorate the nation's big public financial
institutions and help lift the world's third-biggest economy out of
two decades of deflation and tepid growth.
The proportion of the offering reserved for domestic investors was
boosted to 80 percent from the roughly 50-50 split initially
envisaged between foreign and domestic sales, a Finance Ministry
official said, after Abe pushed for greater participation by
domestic investors.
Spokesmen for Japan Post and the Tokyo Stock Exchange declined to
comment. Officials at the Finance Ministry in charge of the sale
could not be reached.
The sale also helps the government exploit a doubling in Tokyo stock
prices since Abe took office in December 2012 as it seeks revenue
and struggles with the industrialized world's biggest public debt
burden.
Companies raised $11.4 billion in IPOs in Japan's stock market last
year, Thomson Reuters data show, up 17 percent from 2013 and 55
percent more than the average of the previous five years. That
slowed to $2.4 billion in the first half of this year but the Japan
Post listing, as well as expected IPOs from Osaka-based Universal
Studios Japan and messaging app creator Line Corp are set to boost
the total significantly.
MAMMOTH IPO
The first round of share sales would be Japan's biggest
privatization since the 2.4 trillion yen listing of Nippon Telegraph
and Telephone Corp in 1987.
Despite the looming flood of fresh supply, market participants
believe the launch will on balance be positive for the market by
encouraging more people to buy stocks.
"It's going to attract many new investors," said Hiroyuki Nakai,
chief strategist, Tokai Tokyo Research Center.
He drew parallels to the NTT listing, when the benchmark Nikkei
stock index was around current levels and, like now, interest rates
were low and oil was cheap.
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"That led to a rush of new investors to the market. This time,
there's a similar background to the Japan Post listing," he said.
Japan Post, which runs the nation's mail-delivery service, applied
to the Tokyo Stock Exchange in June to list the parent as well as
Japan Post Bank Co and Japan Post Insurance Co. Approval from the
bourse is expected on Sept. 10, said the sources, who asked not to
be named as the information is not public.
The Finance Ministry, which owns the company, aims to retain a
one-third stake once all three tranches of the sale are complete.
The group's consolidated net asset value was 15.3 trillion yen at
the end of March.
The privatization of Japan Post was first made into law in 2005
under then-Prime Minister Junichiro Koizumi but it was a highly
divisive issue as postmasters at the nation's more than 20,000 post
offices hold considerable political clout with the ruling party.
"We've been waiting for the prospectus in the mail since Koizumi was
in office, so for Abe to pull it off is a bit of a coup," said Gavin
Parry, managing director of brokerage Parry International Trading in
Hong Kong.
(Additional reporting by Thomas Wilson, Joshua Hunt, Taiga Uranaka
and Tetsushi Kajimoto; Writing by William Mallard; Editing by
Chang-Ran Kim and Edmund Klamann)
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