Japan Post planning ¥4 trillion IPO

Bloomberg, Kyodo

Japan Post Holdings Co. plans to sell shares in an initial public offering by October 2015 as the country’s biggest deposit-holder moves closer toward exiting government control.

The offering will probably take place in phases because of its size, which may exceed ¥4 trillion, postal reform minister Mikio Shimoji told reporters in Tokyo. The size of the IPO will be determined later, he said.

Former Prime Minister Junichiro Koizumi drove efforts to privatize the postal system in the early 2000s to deregulate the economy. The current administration led by Yoshihiko Noda has said proceeds from the sale would help pay for rebuilding from last year’s earthquake and tsunami.

“We wouldn’t want to sell Japan Post shares cheaply because the proceeds will go toward the budget for postquake reconstruction,” Shimoji said. He said he met with Japan Post officials Friday and endorsed their proposal, which will be submitted to the postal privatization committee Monday.

Japan Post Holdings, now wholly owned by the government with net assets of about ¥11 trillion, will incrementally slash the ratio of government-owned equity stakes to one-third.

The company is expected to gain up to ¥7 trillion by selling two-thirds of its shares, a large-scale listing equivalent to those of other major state-controlled corporations, such as Nippon Telegraph and Telephone Corp.

Lending unit Japan Post Bank Co. last month applied to begin selling mortgages next April in a bid to diversify its assets from government bonds before the IPO. Banks oppose the move, saying the playing field isn’t level.