SoftBank Is Raising $21 Billion in IPO to Fund Tech Deals

SoftBank Group founder Masayoshi Son is seeking to raise 2.4 trillion yen ($21.1 billion) in an initial public offering of his Japanese telecom business, according to Bloomberg.

The Japanese technology giant said in a prospectus it will sell 1.6 billion shares at 1,500 yen apiece in a new entity, SoftBank Corp., that will start trading on Dec. 19. At that price, the IPO would surpass the offering of former national carrier Nippon Telegraph & Telephone Corp. in 1987.

Son is listing the company’s cash cow as he transforms SoftBank from a telecom operator into a global investment company. He’s racing to complete the offering as Japan’s wireless industry faces the threat of lower prices, with market leader NTT Docomo saying it plans to cut rates 40 percent in response to government pressure.

SoftBank is looking to tempt investors with a dividend payout ratio of about 85 percent of net income, according to the filing. Based on net income in the last fiscal year, that would work out to an almost 5 percent yield at the indicated IPO price. The IPO price range will be set on Nov. 30, followed by the final price on Dec. 10.