(Bloomberg) — Kioxia Holdings Corp. plans to debut on the Tokyo Stock Exchange in mid-December at a value of about ¥750 billion ($4.8 billion), fast-tracking the move to stay relevant in the competitive memory sector.
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The bourse is likely to approve the Bain-backed chipmaker’s initial public offering on Friday, a person familiar with the matter said. The indicative price of the offering, which was first reported by Reuters, may change depending on market demand, said the person, who asked not to be identified discussing matters that are private.
The long-delayed IPO of the NAND flash memory maker comes as the technological gap between it and sector leader Samsung Electronics Co. widens. A successful debut would give Kioxia, the world’s No.3 NAND maker, the money to ramp up capacity and capitalize on a recovery in chip prices.
The listing, which takes advantage of a new framework designed to speed up the IPO process, is expected to crystallize returns for Bain Capital on a years-long investment that gave it a foothold in the Japanese deals arena.
Bain holds 56% of the company, while Toshiba Corp. owns 41% and Hoya Corp. has 3%, according to data compiled by Bloomberg.
The IPO would need to value Kioxia to yield a better price-to-earnings ratio than at rival Micron Technology Inc., which sells NAND but also high-bandwidth memory, according to Amir Anvarzadeh, Japan equity strategist at Asymmetric Advisors. “Micron has decent HBM exposure, of which Kioxia has zero,” he said, referring to the high-margin DRAM that works alongside accelerator chips to train artificial intelligence. Kioxia “has to be fairly low valued to make it attractive now.”
Spun out from NAND pioneer Toshiba in 2018, Kioxia remains reliant on one type of memory, making it more vulnerable than rivals Samsung and SK Hynix Inc. to market downturns. Since shelving a plan to IPO in October 2020, a prolonged slump in the price of NAND, used for storage in desktop PCs and smartphones, has depressed Kioxia’s ability to invest and expand its offerings to keep up. It only recently emerged from six straight quarters of operating losses.
Earlier this year, the company had eyed an IPO in October, but that had been postponed. Kioxia was then seeking to debut between this December and June next year, Bloomberg reported earlier.
