Tokyo Metro Eyes $4.7 Billion IPO by October-End

Japan's national and Tokyo governments are seeking a 700 billion yen ($4.7 billion) valuation for Tokyo Metro as they prepare to list the subway operator as early as October-end, three sources said, in what would be the nation's biggest IPO in roughly six years.

The two governments, which own 100% of Tokyo Metro, plan to arrange a meeting of brokerages within a week for a briefing on the IPO and expect to receive approval for the listing from the Tokyo Stock Exchange as soon as mid-September, the sources said.

With half the company to be sold, the initial public offering (IPO) could raise 350 billion yen at that valuation, which would exceed the size of Kokusai Electric, opened a new tab IPO last year and become the largest since SoftBank Group, opened a new tab listing its wireless unit in 2018.

The Tokyo government said the timing of the sale is being discussed with the national government and is not decided. 

Tokyo Metro said it would not comment on progress on the listing. Japan Exchange Group, opened a new tab, which operates the Tokyo Stock Exchange, said it cannot comment on specific companies.

The IPO follows the listing of other railway operators, including Kyushu Railway, which opened a new tab in 2016. Tokyo Metro runs 195 kilometers of lines carrying 6.5 million passengers daily.

Tokyo Metro's history dates back to 1920 with the establishment of the Tokyo Underground Railway Company. Seven years later, it opened Japan's first subway line, between the Asakusa and Ueno districts of Tokyo.

The central government, which owns 53.4% of Tokyo Metro, plans to use the funds raised to repay reconstruction bonds issued following the 2011 earthquake and tsunami. The Tokyo government holds the remaining 46.6% of the subway operator.

Japan's national and Tokyo governments are seeking a 700 billion yen ($4.7 billion) valuation for Tokyo Metro as they prepare to list the subway operator as early as October-end, three sources said, in what would be the nation's biggest IPO in roughly six years.

The two governments, which own 100% of Tokyo Metro, plan to arrange a meeting of brokerages within a week for a briefing on the IPO and expect to receive approval for the listing from the Tokyo Stock Exchange as soon as mid-September, the sources said.

With half the company to be sold, the initial public offering (IPO) could raise 350 billion yen at that valuation, which would exceed the size of Kokusai Electric, opened a new tab IPO last year and become the largest since SoftBank Group, opened a new tab listing its wireless unit in 2018.

The Tokyo government said the timing of the sale is being discussed with the national government and is not decided. 

Tokyo Metro said it would not comment on progress on the listing. Japan Exchange Group, opened a new tab, which operates the Tokyo Stock Exchange, said it cannot comment on specific companies.

The IPO follows the listing of other railway operators, including Kyushu Railway, which opened a new tab in 2016. Tokyo Metro runs 195 kilometers of lines carrying 6.5 million passengers daily.

Tokyo Metro's history dates back to 1920 with the establishment of the Tokyo Underground Railway Company. Seven years later, it opened Japan's first subway line, between the Asakusa and Ueno districts of Tokyo.

The central government, which owns 53.4% of Tokyo Metro, plans to use the funds raised to repay reconstruction bonds issued following the 2011 earthquake and tsunami. The Tokyo government holds the remaining 46.6% of the subway operator.