Japan Airlines JAL returned to the Tokyo stock market on Wednesday with just modest gains after a massive $8.5 billion initial public offering IPO. Yet, analysts expect to see strong foreign interest in the carrier, which has turned itself around from bankruptcy just 2-1/2 years ago.
JAL shares rose 1 percent on Wednesday, trading around 3,830 yen in Asia trade – just above the IPO price of 3,790 yen and valuing the entire airline at just under $9 billion, which ranks it alongside Air China Shanghai Stock Exchange: 601111.SS as Asias second biggest airline by market valuation.
Analysts blamed concerns over a territorial dispute between Japan and China for spooking retail investors-who account for 70 percent of the IPOs investors-and dampening what would have otherwise been a strong debut for the stock.
Read the rest of the story: Blue Skies Ahead as Japan Airlines Returns to Market.
Japan Airlines Co. will seek as much as 663 billion yen ($8.4 billion) in the largest initial public offering since Facebook Inc. (FB), capping a state-backed turnaround since it filed for bankruptcy protection in 2010.
Shares will be on offer at a price range of 3,500 yen to 3,790 yen, according to a statement today. That’s in line with the indicative price of 3,790 yen announced earlier this month. The carrier won’t get any of the sale proceeds as the 175 million shares are being sold by its government-backed parent.
JAL will be priced at about five times forecast earnings, compared with 16 times for All Nippon Airways Co. (9202), Japan’s largest carrier. The company is returning to the Tokyo stock exchange after shedding a third of its workforce, scrapping routes and retiring older planes in a restructuring that returned it to profit.
Read the rest of the story: Japan Air Seeks $8.4 Billion in Biggest IPO Since Facebook.