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Japan Post share sale raises $11.6 bn

The sprawling postal group sits on assets worth more than 290 trillion yen

AFP | PTI  |  Tokyo 

Japan post
Japan post | Photo: Reuters

said today that it expects to raise more than $11.6 billion by selling off another chunk of the country's massive

The government will sell 914 million Post at 1,322 yen apiece, it said in a regulatory filing, with the offering set to raise as much as 1.3 trillion yen ($11.6 billion) if domestic and foreign investors snap up an extra allotment of stock.


of Post - which has about 24,000 branches nationwide -- closed at 1,349 yen on Monday, down 1.03 per cent.

The huge sale comes as after an (IPO) in 2015 that began a long-delayed of the state-owned behemoth.

Two years ago the government raised about 1.43 trillion yen in the IPO, which included in Post's and units. It was the country's biggest since Telephone & Telegraph's 1987 listing.

The bulk of the proceeds from the Post sale were earmarked for reconstruction after Japan's 2011 quake-tsunami disaster.

There are hopes that starting to privatise what is effectively the world's biggest bank by deposits could improve investor sentiment and spur efforts to free up Japan's highly regulated

The sprawling postal group sits on worth more than 290 trillion yen.

The branches offer services for cash deposits and insurance, with many ageing retirees withdrawing their pensions from local branches.

That system has long drawn criticism both inside and outside Financial institutions, courier services and foreign governments argue the public body is operating in sectors where it unfairly competes directly with private businesses.

The government of former Prime Minister Junichiro Koizumi split the state-owned giant into units in 2007, to handle deliveries, savings, and counter services at each of its post offices.

Tokyo intially retained full ownership of the firm.

But is struggling with a debt load equal to more than twice the size of its -- one of the heaviest in the world -- and has been looking to sell off state to fund spiralling social-welfare costs.

Post have not performed particularly well, hanging below their 1,400 yen price.

Earlier this year the firm reported its first annual net loss since the 2007 split, which it blamed on an ill-fated $5.1 billion purchase of Toll, an Australian transport logistics giant.

The purchase marked Post's first overseas expansion and came ahead of the 2015 IPO, but a fall in commodity prices and a slowdown in Toll's domestic and Chinese business took a bite out of its bottom line.

First Published: Mon, September 25 2017. 17:48 IST
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