TOKYO: Japan's Rakuten Group Inc said it was planning an initial public offering (IPO) of its banking arm next month, in a probable US$807 million listing that would test demand for the e-commerce giant's online lender amid market uncertainty.
The listing, which was first reported by Reuters on Wednesday (Mar 22), will represent a hefty cash boost for Rakuten, which boasts fast-growing fintech units as well as its mainstay e-commerce platform but has struggled with years of losses from the cost of building out its mobile phone business.
While global bank shares have been whipsawed in recent weeks following the collapse of a number of US regional lenders and the turmoil at Credit Suisse, Japanese banks have so far avoided disastrous hits and are seen as broadly being able to weather the storm.
Rakuten plans to sell 53.95 million existing shares of Rakuten Bank to both domestic and overseas investors, while Rakuten Bank plans to issue 5.55 million new shares, according to regulatory filings. That would value the IPO at 106.8 billion yen (US$807 million), based on the mid-range of the indicative price of 1,795 yen.
The offering will also include a greenshoe option of 4.46 million shares.
The listing would value Rakuten Bank at around 305 billion yen (US$2.31 billion), according to Reuters calculations.
Shares of Rakuten closed up almost 6 per cent, after Reuters reported that it planned to list the banking unit as early as next month, citing sources.