Convenience store operator Lawson Inc. is considering taking wholly owned supermarket chain Seijo Ishii Co. public, it said on Tuesday.

The Nikkei business daily earlier reported that Lawson was planning an IPO for Seijo Ishii by the 2023 financial year, potentially valuing the business at more than ¥200 billion ($1.59 billion).

A Lawson spokesperson, however, said the company is considering a listing of the supermarket business but that a final decision has not been made, including specifics on the size or timing.

Lawson is one of Japan's biggest convenience store chains, with more than 14,500 locations competing with market leader 7-Eleven and FamilyMart. It is 50% owned by trading company Mitsubishi Corp. and also has thousands of stores in mainland China.

A listing for Seijo Ishii would test investor appetite for retailers in a country where household spending has been under pressure for decades and now faces a bigger squeeze from higher import costs and a weaker yen.

However, Seijo Ishii stands apart in the retail market. Where most of its rivals focus on price and value, Seijo Ishii has carved a niche by focusing on expensive, imported goods and high-end domestic products.