TOKYO – The mobile branch of Japanese giant conglomerate Softbank Group made its debut on Wednesday at the Tokyo Stock Exchange at a price 14.5 percent lower than set for its initial public offering (IPO), considered the biggest in Japan so far.
Shares of the newly split telecommunications unit of the parent Softbank Group went on sale at a price of 1,500 yen ($13.36) and ended the day buying at 1,282 yen.
Analysts attributed this cold reception among investors to the uncertainty weighing on the Japanese mobile phone market, of which Softbank is the third largest operator, as well as a starting price that many considered excessive.
The shares of Softbank – name with which the subsidiary of the conglomerate Softbank Group is listed – started trading with a fall of 2.5 percent.
It deepened its depreciation on a day when the benchmark Nikkei index also closed with losses of 0.60 percent.
Based on its opening price, the total market capitalization of Softbank Group’s subsidiary is estimated at 6.1 trillion yen.
With this IPO, which comprises 36.85 percent of the shares in the subsidiary as the parent company will reserve most of the shares, the conglomerate raised an estimated amount of 2.65 trillion yen.
It is the largest IPO to date in Japan with which Softbank Group aims to obtain liquidity to boost its global technology investment fund – the conglomerate’s other main business.
However, the debut in red of the telecommunications subsidiary also weighed on the price of the parent company, one of the companies with the largest capitalization at the TSE and whose shares closed with a fall of 0.9 percent at 8,184 yen.