According to persons with knowledge of the matter, SoftBank Corp. will decide as early as Monday whether to raise up to 120 billion yen (S$1.1 billion) through Japan’s first IPO of bond-type class shares.
According to the persons, a board of directors meeting would be held by the holding company for billionaire Masayoshi Son’s telecoms division to sanction sales of the new shares.
The securities do not grant their owners the ability to vote or convert them into ordinary stock.
Representatives at SoftBank declined to comment.
Due to SoftBank’s well-known brand and a projected dividend rate of 2% to 4% for the first five years, the class shares, which will be traded on the Tokyo Stock Exchange, are likely to draw retail buyers.
Through the Nippon Individual Savings Account program, or Nisa, investors in the securities will also be able to take advantage of tax exemption, the sources claimed.
Even as their global equivalents have increased, interest rates in Japan have remained at historically low levels, and the nation’s central bank last week dispelled rumors of any impending increases.
This increases the need for investments with higher returns, particularly in light of the possibility that Japan’s 1,107 trillion yen stockpile of household savings may start to be increasingly pulled to assets with higher yields abroad, which would further weaken the yen.
After the fifth year, the class shares’ annual dividend rate will change, and SoftBank has the right to buy them back at the issue price.
The money raised will go toward next-generation social infrastructure as well as growth initiatives in the fields of information and communication technologies.
According to the persons, the offering will mostly be directed at individuals as well as certain institutional investors.
According to the sources, SoftBank will probably reveal the offering’s specifics as early as Monday, including the total amount, the sale and pricing dates, and the underwriters.
Nomura Securities Co. will serve as the deal’s lead underwriter, and the parameters will be decided through a book-building process including bond and equity investors, according to the sources. BLOOMBERG
Previously, Arm Holdings’ successful IPO by SoftBank Group has enabled the corporation to resume its acquisition binge. On its first day of trade, Arm’s shares increased 25%, more than tripling SoftBank’s initial purchase price. SoftBank will be able to take out margin loans, raise its credit score, and utilise Arm’s shares as collateral thanks to the IPO. Due to low valuations and a shortage of capital for early-stage firms, analysts think SoftBank’s timing for acquisitions is advantageous.
