Kioxia, backed by Bain Capital, filed for an IPO on Friday, with sources indicating the Japanese chipmaker is targeting a December listing.
Japanese chipmaker Kioxia files for IPO
This IPO registration marks a renewed effort to go public after Bain previously shelved plans in October. According to sources, investors had pressured the U.S. private equity firm to nearly halve its initial target valuation of 1.5 trillion yen ($9.8 billion).
Kioxia is the first company to take advantage of Japan’s new IPO rules, which allow firms to engage with potential investors before receiving official listing approval from the Tokyo Stock Exchange. The chipmaker expects to obtain approval by late November, at which point it will disclose an indicative share price, sources familiar with the matter said, requesting anonymity as details have not been publicly released.
Kioxia’s filings suggest it plans to conduct the IPO between December and June.
A consortium led by Bain acquired Kioxia, formerly Toshiba Memory, from the scandal-hit Toshiba Corp. six years ago for 2 trillion yen. The company has since been paying Bain an annual consulting fee of 1 billion yen, which will end with the IPO. Upon listing, Kioxia will pay Bain an additional 3.5 billion yen.
Chip market downturn hit the company
The chipmaker, which competes with global rivals like Samsung Electronics and SK Hynix, has been impacted by a downturn in the memory chip market. The industry is currently debating the sustainability of a recent rebound in chip prices. However, Kioxia reported a promising 32% increase in operating profit to 166 billion yen for the July-September quarter compared to the previous quarter. The company also plans to expand capacity, driven by rising demand for chips in artificial intelligence applications.
Kioxia specializes in NAND flash memory, a technology it pioneered in the 1980s. Key customers include Apple and Dell, which accounted for 21% and 9% of its sales, respectively, in the fiscal year ended March.
Morgan Stanley, Nomura, and BofA Securities are serving as joint global coordinators for the IPO.
