Kokusai Electric shares untraded with glut of buy orders in Tokyo debut (updated)

Kokusai Electric

25/10/2023 01:08

(Adds details of IPO, graphic)
    By Sam Nussey
       TOKYO, Oct 25 (Reuters) - Shares of Kokusai Electric
 6525.T  were untraded with a glut of buy orders in the chip
equipment maker's stock market debut on Wednesday in the largest
Tokyo listing in five years.
    Kokusai raised $724.4 million after pricing its shares at
1,840 yen, providing a partial exit for private equity firm KKR,
which has cut its stake to 47.7% from 73.2% without
overallotment. 
    Chip tool makers have been suffering from a downturn in the
market for electronics such as smartphones and PCs, with early
euphoria over advances in generative artificial intelligence
also cooling. 
    Kokusai is exposed to slumping demand for memory chips but
that market is expected to rebound with the tool maker also able
to expand in other segments, said Kazuyoshi Saito, an analyst at
Iwai Cosmo Securities.
    KKR agreed to buy Hitachi's  6501.T  electronic equipment
unit in 2017 in a deal valuing the business at 257 billion yen 
($1.72 billion) as the conglomerate streamlined operations.
    The private equity group then spun off Kokusai, which
manufactures machines for depositing thin films on silicon
wafers, the following year.
    KKR sought to sell Kokusai to competitor Applied Materials
 AMAT.O  in 2019, but the $3.5 billion deal was terminated after
failing to obtain regulatory approval in China.  
    Applied Materials has built a 15% shareholding in the
company over the last three years.

($1 = 149.8500 yen)

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To You, Mr. Chips    https://tmsnrt.rs/3QuYV3K
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 (Reporting by Sam Nussey
Editing by Chang-Ran Kim)
 ((sam.nussey@tr.com))