New Shares of Japan Post to Be Sold Soon

The Japanese government announced on Monday that it intends to sell another portion of its stake in the postal company Japan Post through an initial public offering (IPO), potentially raising up to $12 billion.

Japan Post is a state-owned postal company with an extensive network of approximately 24,000 post offices across the country. In addition to postal services, the offices also offer savings and insurance services, and many Japanese retirees withdraw their pensions there. The value of Japan Post’s assets exceeds 290 trillion yen.

The group has long been the target of criticism, both in Japan and abroad, with financial institutions, courier companies, and governments of other countries accusing it of operating in sectors where it directly competes with private companies.

>>> The Japanese government will sell shares of Japan Post

In 2007, the government of former Prime Minister Junichiro Koizumi separated Japan Post into divisions for parcel delivery, savings, insurance, and various services, initially retaining ownership of the group.

At the end of 2015, official Tokyo held an initial public offering of shares of the banking and insurance division of the postal company after several years of delays, raising 1.43 trillion yen. Most of the money was directed towards addressing the aftermath of the earthquakes and tsunami that struck the country in 2011.

Prior to that sale, Japan Post was de facto the largest bank in the world by deposits, and the government hoped that initiating its privatization after years of delays would encourage investors and ultimately reduce the regulatory burden on the economy. Today, they announced the sale of another 22 percent stake in the company, or 990 million shares. They estimate that the sale could generate 1.3 trillion yen.

The decision on the share price will be determined between September 25 and 27, the Ministry of Finance added in a statement.