Japan Post Holdings Co. plans to go public together with its banking and insurance units in spring 2015, sources close to the matter said Wednesday.
The disclosure suggests the state-owned financial behemoth is flip-flopping on its original plan to hold off on the IPOs for Japan Post Bank Co. and Japan Post Insurance Co. until more than 50 percent of the holding firm’s shares are sold.
Japan Post Holdings President Taizo Nishimuro, who took the post in June, is leading the reversal in response to U.S. concerns that the government-backed bank and insurer might expand and put foreign firms at a disadvantage in Japan, the sources said.
The IPOs are being accelerated to reduce the government’s massive stakes in the two giants and is expected to help ease U.S. concerns that emerged in preparatory talks for the Trans-Pacific Partnership negotiations before Japan joined the trade talks in July.
Once the holding company makes its initial public offering, the Japanese government is expected to sell ¥8 trillion of its shares, or about two-thirds of its holdings. If such a big IPO coincides with those for the two other units, the stock market could plunge into confusion.
To avoid that situation, Japan Post Holdings is considering allotting shares of the two units to investors who also purchase shares in the parent, the sources said.
The government plans to commit ¥4 trillion of the proceeds from the Japan Post Holdings IPO to reconstruction efforts in Tohoku, which was heavily damaged by the March 2011 earthquake and tsunami. A specific IPO plan is expected to be released by next February.
The IPO is designed to finalize the postal system privatization process that began in 2005 under the leadership of then Prime Minister Junichiro Koizumi.