Rakuten Bank jumps 33% after Japan’s largest IPO since 2018
RAKUTEN Bank surged 38 per cent in its debut in Tokyo on Friday (Apr 21), following Japan’s largest initial public offering (IPO) since 2018.
Shares closed at 1,930 yen apiece. The banking unit of billionaire Hiroshi Mikitani’s Rakuten Group raised 83.3 billion yen (S$829.8 million) selling the shares. They were priced at 1,400 yen each, the top of a target range that was lowered earlier in the offering process.
Rakuten Bank’s listing revives the IPO market in Tokyo, where no first-time share sale had exceeded 50 billion yen this year.
The lender and its holder marketed the shares amid high volatility for banking stocks globally, following the failures of several US banks and turmoil at Credit Suisse. Still, it was the largest debut in Japan since the US$20 billion-plus IPO of SoftBank in December 2018.
The lender’s chief executive officer Hiroyuki Nagai told reporters on Friday that he does not see an immediate need to make a public share sale through the end of March 2027.
Forty-two companies that raised more than 50 billion yen in IPOs in Japan in the 10 years prior to Friday rose by an average of 7.3 per cent in their first session, based on data compiled by Bloomberg.
Online lender SBI Sumishin Net Bank, which had its IPO in March, could give an indication of the appetite for banking shares ahead of Rakuten’s start. The rival is up 38 per cent since its debut on March 29.
Rakuten Bank had initially set an indicative price band of 1,630 to 1,960 yen for the shares, then lowered the range to 1,300 to 1,400 yen, suggesting weaker-than-expected demand.
The listing is part of Rakuten Group’s plan to expand its financial business. Competition from Amazon has capped its core e-commerce revenues, while aggressive promotions for its struggling mobile unit have saddled the company with losses.
Rakuten Group offered up to 84 per cent of the shares available in the IPO, and will retain a stake of about 63 per cent in the banking unit after the listing, as indicated by the terms of the deal. BLOOMBERG
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