Govt Sale Of Japan Post, Tokyo Metro Shares Faces Uncertainty

TOKYO (Nikkei)--With the government set to earn higher-than-expected revenue from the sale of its Japan Tobacco Inc. (2914) stockholdings, the focus has shifted to its future sales of Japan Post Holdings Co. and Tokyo Metro Co. shares.

Although unloading holdings in other firms besides Japan Tobacco could bring in up to 8.9 trillion yen, several issues could disrupt the government's plans to sell shares in firms above the amount it is legally required to hold.

The government currently owns 100% of Japan Post Holdings, which is slated to list in fall 2015. The stock sale is expected to generate up to 7 trillion yen, second only to the 15 trillion yen raised from the privatization of Nippon Telegraph and Telephone Corp. (9432). However, mail delivery operations continue to bleed red ink, and the bread-and-butter banking and insurance operations have been facing delays in obtaining approval to enter new businesses. So, it is unclear if Japan Post's stock price will meet the government's expectations when offered to the public.

The government owns 53.4% of Tokyo Metro, with the remainder held by the Tokyo Metropolitan Government. The central government, whose holdings are worth 200.4 billion yen, aims to fully privatize the unit by listing it. But the Tokyo government plans to buy the central government's holdings and integrate the subway network with Tokyo's public subway network.

(The Nikkei, March 12 morning edition)

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