Banking Crisis
Nikko Tokyo IPO Plans Scuppered On Market Volatility
Nikko Asset Management, one of Japan’s largest asset managers, has shelved plans to list its shares in Tokyo, blaming market volatility.
Nikko Asset Management, one of Japan’s largest asset managers, has shelved plans to list its shares in Tokyo, blaming market volatility.
The firm had planned to float its shares on the Tokyo Stock Exchange on December 15. The listing, worth an estimated $623 million, would have been the second biggest in Japan this year.
“In consideration of recent market conditions and other factors, the company has, following a resolution adopted at the meeting of the Board of Directors of the company held on December 2, 2011, determined to cancel the anticipated secondary offering of shares of its common stock and to suspend the related listing process of its shares on the Tokyo Stock Exchange, as previously resolved at the meeting of the Board of Directors held on November 16, 2011,” said the firm in a statement published today.
The firm added that if and when the economy improves, Nikko may resurrect the float.
“The company remains committed to the belief that, as a publicly listed asset management company, it can contribute to the development of the Asian asset management industry and help millions of Asian investors grow their wealth.”
“However, as there is no need for the company to raise cash through an immediate listing, the company has decided that it is appropriate to suspend the listing during this time of market volatility. As such, the company will seek to resume its listing plans when market conditions are more stable,” it said.
Last month Sumitomo Mitsui Trust Holdings, which holds a 91 per cent stake in Nikko AM, said it planned to float a 30 per cent tranche of Nikko stock in a secondary offering.
The company said it would offer 54,158,800 Nikko AM shares, 19,874,800 in Japan and 34,284,000 abroad, with up to 2,981,200 exiting shares under an overallotment arrangement in case of exceptional demand.
The cancellation of the initial public offering highlights how bleak market conditions and uncertain investor sentiment are making it very difficult for companies to raise capital.
