Bain Capital-backed Kioxia Holdings Corp. priced its initial public offering Monday, continuing a year of mammoth deals in Tokyo with a transaction that values the memory-chip manufacturer at $5.2 billion.

The shares were priced at ¥1,455 ($9.7), right at the middle of the planned range, in an IPO that’s the third-largest in Japan this year.

The world’s No. 3 NAND maker is listing as Japan’s IPO market sees the largest volume since 2018. Corporate Japan is set to raise about ¥930 billion this year through initial share sales, after subway operator Tokyo Metro Co. and scientific-equipment maker Rigaku Holdings Corp. pushed ahead with the biggest listings so far in 2024, Bloomberg-compiled data show.

Japan’s IPO market has been booming, as a campaign to boost shareholder value as well as the end of deflation have helped stocks reach record levels.

Kioxia, which is set to debut Dec. 18 on the Tokyo bourse, last week set a price range from ¥1,390 to ¥1,520. The IPO values Kioxia at ¥784 billion. The offering size was ¥120 billion including an overallotment option.

Since shelving a plan to IPO in October 2020, a prolonged slump in the price of NAND has depressed Kioxia’s ability to invest and expand its offerings to keep up. The listing would help Kioxia ramp up capacity as it fights to remain relevant in the capital-intensive memory race. The company could achieve sales growth in line with the industry average, according to Masahiro Wakasugi, a Bloomberg Intelligence analyst.

While sales volume has zoomed higher, the number of IPOs including those in the pipeline remains the lowest since 2014, suggesting that borrowers that do raise funds are taking more out of the market. Large listings are gaining momentum as private equity funds like Carlyle Group Inc. and MBK Partners Ltd. exit their investments. MBK-backed Kuroda Group Co. plans to go public a day before Kioxia’s debut.

Sales of NAND flash-memory-chip and solid state drive makers could increase on rising demand from AI-server customers, Wakasugi wrote in a note this month. That may prove to be a boon for the company due to its advanced NAND and SSD technologies, he wrote.

By: DocMemory
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