Softbank Group eyeing IPO for mobile phone unit

January 15, 2018

Tokyo- Major Japanese Internet and telecommunications conglomerate Softbank Group Corp. is considering an initial public offering for its mobile phone unit, Softbank Corp., informed sources have said.

The group will shortly start full-fledged consultations with the Tokyo Stock Exchange, aiming to realize the key unit's stock listing this year, the sources said.

This could be one of the largest IPOs in Japan as the amount of funds to be procured through the move may reach as much as about 2 trillion yen, according to the sources. The funds are expected to be used to boost the financial strength of the subsidiary and for investment in new business areas, the sources said.

The largest IPO in Japan was that of Nippon Telegraph and Telephone Corp. in 1987, in which the company raised about 2.3 trillion yen.

Softbank Corp. is one of Japan's three major mobile phone carriers. Its two rivals are NTT Docomo Inc. and KDDI Corp. It also offers fixed-line telephone and broadband Internet services.

Softbank Group launched its mobile phone service by acquiring Vodafone K.K., the Japanese unit of Britain's Vodafone Group PLC, in April 2006. Vodafone K.K. changed is name to Softbank Mobile Corp. later that year and to Softbank Corp. in July 2015.

The unit's annual sales total some 3 trillion yen, accounting for 35 percent of the group's total revenue.

Softbank Group, a holding company, is listed on the TSE's first section. As of Friday, its market capitalization totaled more than 9.8 trillion yen.

Softbank Group has expanded its operations by aggressively promoting business acquisitions. Among its affiliates are Internet portal Yahoo Japan Corp. , major US mobile phone carrier Sprint Corp. and British semiconductor design company Arm Holdings PLC.

The parent has a 99.99 percent equity stake in Softbank Corp. in terms of voting rights. As of the end of last September, the unit had about 39.1 million subscriptions.

In a statement released on Monday, Softbank Group said, "We are always studying various capital strategy options."

While noting that the listing of the mobile phone unit is "one such option," the parent company said, "No decision has been made to officially proceed with this course." Jiji Press