Photographer: Kiyoshi Ota/Bloomberg

Japan Post to Announce Trillion-Yen Share Sale Sept. 11

  • First divestment by government since postal giant’s 2015 IPO
  • Sale plans were complicated by writedown, scrapped deal

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Japan Post Holdings Co. will announce plans for a share sale by the government as early as Sept. 11, almost two years after the postal and financial-services giant was listed, people with knowledge of the matter said.

The Ministry of Finance plans to offer about 1 trillion yen to 1.4 trillion yen ($9.1 billion to $12.8 billion) of Japan Post Holdings shares to local and overseas investors by the end of September, the people said, asking not to be identified before the announcement. The process could be delayed if the situation in North Korea deteriorates further, they said.

The ministry unveiled plans for the additional offering in January, before selecting underwriters including global coordinators Goldman Sachs Group Inc., Nomura Holdings Inc. and Daiwa Securities Group Inc. Efforts to carry out the sale have been complicated by the company’s April disclosure of a 400.3 billion-yen writedown on its investment in an Australian logistics firm, plus its decision to scrap plans to acquire Nomura’s stake in a real estate company. 

Finance Minister Taro Aso said the ministry will monitor developments in the standoff with North Korea over its nuclear program. Japanese stocks extended declines and the yen gained further on Tuesday after the Asia Business Daily reported that Kim Jong Un’s regime is preparing to fire another intercontinental ballistic missile, days after it conducted a nuclear test.

Stock Impact

“If something happens in North Korea or on the peninsula, we will have to take various things into the consideration including any impact on share prices,” Aso said at a regular news briefing in Tokyo. “We need to keep watching the situation.”

Junichi Shirato, a Tokyo-based spokesman for Japan Post, declined to comment.

Shares of Japan Post fell 3.3 percent, the most since January, to close at a 10-month low of 1,282 yen. The holding company has slid 8.4 percent since it began trading in November 2015, as demand for postal services slumps and its banking and insurance units struggle to cope with rock-bottom interest rates.

In a potential boost for the share sale, Japan Post will be added to the Nikkei 225 Stock Average on Oct. 2, along with Recruit Holdings Co., Nikkei Inc. said after the close of trading. The change may prompt passive funds to add the postal company to their portfolios.

Read this QuickTake for more on Japan Post’s privatization

Meanwhile, Japan Post will raise parcel delivery fees by 12 percent on average from March 1 in an effort to improve services and absorb rising costs, it said Tuesday.

Japan Post and its banking and insurance units were listed following a 1.4 trillion-yen initial public offering, the nation’s largest privatization deal since Nippon Telegraph & Telephone Corp. in 1987. The government is reducing its stake to raise funds for the reconstruction of areas devastated by the 2011 earthquake and tsunami in northern Japan.

The finance ministry remains the biggest owner of the holding company, which in turn is the largest shareholder in the bank and insurer.

— With assistance by Gareth Allan

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