April 4, 2019 / 8:25 AM / 3 months ago

UPDATE 1-Japan Post Holdings to sell nearly a 3rd of its Japan Post Insurance stake

* Sale of Japan Post Insurance shares is first since 2015 IPO

* Offering would be worth $3.7 bln based on Thursday’s close

* Japan Post Insurance also buying back up to 100 bln yen of stock (Adds details, background)

By Chris Gallagher

April 4 (Reuters) - Japan Post Holdings is selling nearly a third of its stake in financial unit Japan Post Insurance in an offering that could fetch around $3.7 billion, as a step aimed at advancing the privatisation of the Japan Post group.

The postal and financial giant plans to sell around 168.1 million of its shares in Japan Post Insurance this month, the first sale of stock in the unit since the initial public offering (IPO) of the Japan Post Group in 2015.

Some 112.6 million shares will be offered in Japan, with the remainder to be sold overseas including a green shoe option, Japan Post Insurance said in a statement on Thursday.

The sale is “expected to help further move forward the steady implementation of the privatisation of the Japan Post group,” Japan Post Insurance said, adding that it would help investor demand by enhancing the market liquidity of its stock.

The offering price will be determined between April 15 and April 17.

Based on Japan Post Insurance’s closing share price on Thursday, the stake sale would be worth 409 billion yen ($3.7 billion).

Japan Post Holdings, Japan Post Insurance and Japan Post Bank listed simultaneously in 2015 with the government raising some $12 billion, marking the country’s biggest privatisation in almost 30 years.

The government has pledged to continue reducing its stake in the Japan Post Group. It still owns 56.9 percent of Japan Post Holdings, which in turn owns 89 percent, or 534 million shares, in Japan Post Insurance.

Plans call for Japan Post Holdings to initially reduce its stake in the insurance and banking units to 50 percent in multiple stages, and eventually dispose of its entire interest, according to Japan Post Insurance’s annual report.

Japan Post Insurance also said it would buy back up to 50 million of its shares for as much as 100 billion yen. (Reporting by Chris Gallagher; Editing by Gopakumar Warrier and Muralikumar Anantharaman)

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