SoftBank IPO Sees 2-3 Times Institutional Investor Demand
(Bloomberg) -- SoftBank Group Corp.’s 2.65 trillion yen ($23.6 billion) initial public offering of its Japanese telecommunications business met with robust demand from overseas and Japanese institutional investors, people familiar with the matter said.
Foreign investors sought more than three times as many shares than were for sale, while Japanese institutional demand reflected a bid-to-cover ratio of about two by the end of bookbuilding a week ago, said the people, who asked not to be identified because the information isn’t public. Demand from retail investors, who made up about 90 percent of the offering, was almost double the shares allocated, according to one lead underwriter.
The shares of SoftBank Corp., as the new entity will be called, will trade on the Tokyo Stock Exchange from Dec. 19. Further demand for the stock may come from institutional investors seeking to add it to their portfolios, the people said. Healthy appetite for the shares was also seen in the final price of 1,500 yen announced earlier this week, which followed a major network outage and a global stock slump.
Nomura Holdings Inc., Deutsche Bank AG, JPMorgan Chase & Co., Sumitomo Mitsui Financial Group Inc., Mizuho Financial Group Inc. and Goldman Sachs Group Inc. are the joint global coordinators. Representatives of SoftBank and the underwriters declined to the comment on the level of demand.
The lead underwriters and other managers for the sale will receive more than 60 billion yen in fees for the offering, according data calculated by Bloomberg. The transactions will settle today.
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