SoftBank Group[1] said on Monday it was considering listing its Japanese wireless business - a move that could reportedly raise $18 billion and would accelerate the conglomerate's transformation into one of the world's biggest tech investors.
A spin-off - potentially the biggest IPO by a Japanese company in nearly two decades - would give the unit more autonomy and help investors value the business as well as its parent which has myriad holdings across the tech industry.
SoftBank Group is aiming to sell about 30 percent of SoftBank, Japan's No. 3 wireless carrier, for around JPY 2 trillion ($18 billion), the Nikkei newspaper said without citing sources. It added that proceeds will go towards investments in growth such as buying into foreign information technology companies.
"It makes sense to spin off the mobile-phone business using a public offering that would leave SoftBank in control and provide SoftBank with more cash to pursue its strategy of investing in companies with potentially high growth prospects," Erik Gordon, a professor at the University of Michigan's Ross School of Business.
"It is a way of obtaining capital without adding debt or diluting SoftBank's equity interests in the growth companies."
SoftBank Group plans to seek approval from the Tokyo Stock Exchange as early as spring, the Nikkei said, adding that it was aiming to list around autumn in Tokyo as well as overseas, possibly London.
The conglomerate said in a statement that a listing of the telecoms business was one option for its capital strategy but that no such decision had been made. Its shares finished 3 percent higher on the news.
An IPO of about 2 trillion yen would be one of the biggest offerings by a Japanese company, rivalling a 2.1 trillion...