Japanese chipmaker Kioxia files for IPO; sources say it's targeting December
Bain scrapped October IPO for Kioxia
Kioxia is first company to use new IPO process
Rules allow Kioxia to sound out investors
Recasts and writes through
By Miho Uranaka and Sam Nussey
TOKYO, Nov 8 (Reuters) -Bain Capital-backed Kioxia filed for an IPO on Friday and sources familiar with the matter said the Japanese chipmaker was targeting December for the offering.
The IPO registration marks a fresh attempt to go public. Bain scrapped plans for an IPO in October after investors pushed the U.S. buyout firm to almost halve the 1.5 trillion yen ($9.8 billion) valuation it was seeking, sources have previously said.
Kioxia is the first company to have chosen to operate under new rules in Japan which allow firms to communicate with potential investors in the IPO before receiving listing approval from the Tokyo Stock Exchange.
The chipmaker expects to receive approval in late November and the indicative price for the shares will be disclosed at that time, said the sources who declined to be identified as the company has not made the information public.
Kioxia's filings indicate it aims to conduct the IPO sometime from December through June.
A Bain-led consortium acquired Kioxia from scandal-hit Toshiba six years ago for 2 trillion yen.
The chipmaker, formerly Toshiba Memory, pays Bain an annual business consulting fee of 1 billion yen which will cease with the listing, when Kioxia will owe the buyout firm an additional 3.5 billion yen.
Kioxia, which competes with overseas rivals such as Samsung Electronics 005930.KS and SK Hynix 000660.KS, has been hammered by a downturn in the market for memory chips with the industry debating the durability of a recent recovery in prices.
In one encouraging sign, it reported a 32% rise in operating profit to 166 billion yen in the July-September quarter compared to three months earlier. It also plans to expand capacity on the back of the boom in chips for artificial intelligence applications.
Kioxia is focused on NAND flash memory, which it invented in the 1980s, with customers Apple AAPL.O and Dell making up 21% and 9% of its sales respectively in the year ended March.
Morgan Stanley, Nomura and BofA Securities are joint global coordinators for the IPO.
($1 = 153.2200 yen)
Reporting by Miho Uranaka and Sam Nussey; Editing by Christopher Cushing and Edwina Gibbs
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