DJ: Japan Tobacco Offering Price Set At Y2,949 Per Share

TOKYO--The Japanese government will sell a portion of its stake in Japan Tobacco Inc. (2914) for 2,949 yen ($31) per share, according to a regulatory filing, in what would be the nation's biggest share offering since 2010.

The price represents a 2.0% discount on JT's closing price of Y3,010 Monday. The sale is aimed at raising funds for reconstruction after the March 2011 disaster.

According to the filing by JT, the government will sell 253.26 million shares of the world's third biggest tobacco maker, commonly known as JT. Of the total, 107.6 million shares will be allocated to overseas investors and the remaining 145.6 million shares to domestic investors.

The amount will give the government's public offering of JT shares a value of about Y746.9 billion, or $7.8 billion, and will draw down the government stake in JT to about 33%.

Ahead of the stake sale, JT has bought back a total of 80.07 million of its own shares from the government. The government will offer the remaining portion to the public.

JT was privatized in 1985 and the latest sale would mark the fourth time that the government has offered shares of the company, ranked after Philip Morris International Inc. (PM) and British American Tobacco PLC (BTI) in global sales volume.

In April 2010, Dai-Ichi Mutual Life Insurance Co. (8750) listed on the Tokyo Stock Exchange with an offering valued around $11 billion.