Toshihiko Aoyagi (left), President of Kyushu Railway Company also known as JR Kyushu, holds an IPO certificate with Tokyo Stock Exchange President Koichiro Miyahara during a ceremony to mark the company’s debut on the Tokyo Stock Exchange in Tokyo, yester
Tokyo: Japan’s Kyushu Railway rocketed yesterday as the former state-owned firm made its trading debut in Tokyo after scoring one of this year’s biggest initial public offerings. The firm soared as much as 20 percent in the morning before ending at 2,990 yen, up 15 percent from its IPO price.
The firm raised 416bn yen ($4.0bn), making it the world’s third biggest share sale this year after Postal Savings Bank of China’s $7.4bn listing in September and an offering this month from German renewable energy firm Innogy, worth about ¤5.0bn ($5.4bn). Tokyo sold shares in the struggling regional railway, better known as JR Kyushu, hoping to attract big-saving Japanese households as part of broader efforts to kickstart the economy.
The company, born out of the 1987 breakup of Japanese National Railways, has struggled with a money-losing railway business as the region’s population declines.
To counter those losses, the firm — based in Fukuoka, about 900km southwest of Tokyo — has diversified into real estate, hotels and restaurants. “We’ve focused on non-rail assets and that’s led to synergies,” President Toshihiko Aoyagi said after the listing ceremony in Tokyo. “We want to step that up in the future.” Chairman Koji Karaike, 63, a company veteran and judo black belt, said he could not have imagined listing the company three decades ago. “No one, including ourselves, thought we’d ever be able to list our shares,” he told Bloomberg News in an interview this month. With losses equivalent to almost 30 percent of sales, the company “faced a sense of crisis that we would fade away”, he said.
