(To read more on the debt and equity markets, click here.)
TOKYO-Nomura Real Estate Holdings has revealed plans to raise about yen 109 billion ($930 million) in an initial public offering ahead of a listing on the Tokyo Stock Exchange on Oct. 3. The IPO will be Japan's biggest this year.
Officials of the real estate company, which competes with industry leaders Mitsubishi Estate and Mitsui Fudosan, say they plan to use the proceeds to buy properties and to pay back debt. Nomura Real Estate Holdings will offer 36 million new shares at an estimated price of yen 3,200. The final IPO price will be set on Sept. 21, following a book-building period.
Another five million shares will be sold by existing shareholders. Nomura Securities, the lead underwriter, also has an option to offer an additional six million shares if demand is strong. The estimated IPO price values Nomura at 20 times its earnings per share forecast of 160.7 yen for the current business year to March. That compares with Mitsui Fudosan at 35 times and Mitsubishi Estate at 54.
Nomura's IPO will be the largest this year in Japan. In March this year, sportswear retailer Alpen sold 52 billion yen of shares. Bic Camera Inc., a nationwide chain of discount electronics outlets, sold 34.5 billion yen shares in a public offering last month.
The size of the IPO reflects the improvement in the Japanese property market. Land prices in the world's second-biggest economy rose 0.9% last year, the first increase since Japan's property bubble burst in 1991, the National Tax Agency reported this month. The Topix real estate index, which tracks 49 property developers, rose 2.4% in the past six months, outperforming a 3.6% decline by the benchmark Topix.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
