Memory chipmaker Kioxia files for Japanese IPO – report

Private equity firm Bain Capital-backed Kioxia filed a registration statement for a Japanese IPO, Reuters reported.

Kioxia, which is among the world’s largest makers of NAND flash memory, intends to conduct an IPO anytime between this December and next year June on the Tokyo Stock Exchange, the report added.

The company is targeting December, the report noted citing two people with knowledge of the matter.

Kioxia is the first company to use new rules which allow companies to test investor appetite before seeking listing approval from the Tokyo Stock Exchange, according to the report.

The company anticipates to receive approval from the Exchange in late November, with the indicative price of the IPO disclosed at that time, the report added. The schedule is flexible in the filings as per the new rules.

Kioxia, reportedly, had called off IPO plans for October in Japan, after investors pushed Bain to almost half the valuation it was seeking for the chipmaker. Previously, Bain was in discussions with investment banks to list the Japanese company. Kioxia was expected to raise about $500M, and garner a market capitalization of over 1.5T yen ($10.3B) via the IPO.

The sell-off in shares of Kioxia’s listed peers had made the pricing challenging, as per the previous report. Shares of Samsung Electronics (OTCPK:SSNLF), SK hynix and Micron Technology (MU), had seen a decline from their highs.

Bain, which led a consortium to acquire Kioxia from Toshiba for $18B in 2018, has thought about listing Kioxia in the past as well. A 56% stake in Kioxia is owned by a special-purpose company formed by Bain and South Korean chipmaker SK hynix. Toshiba has a 41% stake in Kioxia, according to a previous report by Nikkei.

Kioxia pays Bain an annual business consulting fee of 1B yen which will end with the listing, when Kioxia will owe the buyout firm an additional 3.5B yen, as per the Reuters’ report.

Kioxia is working on expanding capacity driven by the demand for chips for AI applications, the report noted.

Morgan Stanley, BofA Securities and Nomura are joint global coordinators, the report added.