Medical Device Maker PHC Plans Biggest Japan IPO Since 2018

Japanese medical device maker PHC Holdings Corp. and its shareholders are looking to raise as much as 172 billion yen ($1.6 billion) in a Tokyo initial public offering that would be country’s biggest in almost three years.

The sale will comprise about 46.5 million shares, of which 5.8 million will be new and 40.7 million will come from existing shareholders including private equity firm KKR & Co., according to terms of the deal seen by Bloomberg News. An indicative IPO price has been set at 3,700 yen per share, though the final one will be decided on Oct. 6, the terms show.

PHC’s IPO would be Japan’s biggest first-time share sale since the $21 billion listing of SoftBank Group Corp.’s telecommunications business in December 2018, data compiled by Bloomberg show. 

Large IPOs have been hard to come by in Japan since then, with Kioxia Holdings Corp., the memory chipmaker spun out of Toshiba Corp. in 2018, postponing its planned $2.9 billion IPO about a year ago because of unfavorable market conditions.

This year about $3.4 billion has been raised through Japanese IPOs, a huge increase from the $804 million garnered in the same period in 2020, data compiled by Bloomberg show.

Japanese stocks have faced an upsurge of interest after the announcement last week that Prime Minister Yoshihide Suga will step down -- sparking optimism for new policies to spur the economy -- as well as the revamp of Tokyo’s blue-chip gauge.

The company, which traces its history to 1969, develops, manufactures and sells medical equipment including diabetes monitoring and other diagnostics systems in areas such as life sciences and health-care IT, according to its website

PHC plans to use the proceeds of the IPO to strengthen distribution and logistics networks in the diabetes management segment, increasing the production capacity in diagnostic and life sciences and to pay down borrowings.

The selling shareholders in PHC’s IPO are KKR PHC Investment LP, Mitsui & Co., Life Science Institute Inc., Panasonic Corp., and LCA 3 Moonshot LP, the terms show. 

The price range will be announced on Sept. 28, with listing slated for October 14.

Goldman Sachs Group Inc., Bank of America Corp., JPMorgan Chase & Co., Morgan Stanley, KKR, Sumitomo Mitsui Financial Group Inc. and Mizuho Financial Group Inc. are joint global coordinators for the offering. 

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