Sources say that JERA is studying the US listing in order to expand overseas.
Three people familiar with the matter said that JERA, Japan’s largest power generator, is launching a feasibility study to explore ways of expanding overseas and enhancing funding options.
People said that the unlisted company owned by Tokyo Electric Power (TEP) and Chubu Electric Power (CEP) has always viewed the Tokyo Stock Exchange, as the primary listing option, but now is exploring ways to increase engagement with global investors, as it accelerates international expansion.
JERA is examining U.S. investor demand, market conditions and regulatory requirements. Two people who declined to be named as this matter was confidential.
JERA said that the study was still in its early stages and they had not yet made any decisions about timing, listing structure, or market valuation.
JERA has been indicating its desire to pursue an IPO for years in order to increase capital and corporate value. One of the people said that overseas institutional investors have increased their demand for engagement, which has led JERA to increase its outreach.
JERA is the first to announce its considerations for a possible U.S. listing.
JERA refused to comment. Tokyo Electric and Chubu Electric declined to comment.
JERA SEEKS GLOBAL EXPANSION
The assets of Japan's largest buyer of liquefied gas are around 10 trillion yen. This generates an annual revenue of about 3 trillion yen (18.48 billion dollars). The country's total power generation capacity, including those projects in development, is 59 gigawatts. This is equivalent to about 30% of its power.
JERA plans on investing 5 trillion yen between fiscal 2024 and 2035. The goal is to achieve a net profit of 350 billion dollars by that point, up from 183.6 billion dollars in fiscal 2025.
Recent investments and purchases have focused on the U.S. The utility has also expanded its renewable energy business.
The Nikkei reported that JERA is considering large-scale gas-fired power stations in the U.S. in order to meet the surging demand for electricity from data centres. This highlights the importance of the company's overseas operations.
A listing could boost JERA's ability to fund large energy projects and international expansion, while ?raising its profile among global investors and providing stock that could be exchanged in merger-and-acquisition deals.
JAPANESE COMPANIES TAPPING U.S. CAPITAL MARKET
JERA's report comes at a time when a growing number of Japanese companies are turning to U.S. capital markets to expand their investor base, as their businesses become increasingly global.
PayPay, which is owned by SoftBank Group and listed on Nasdaq this year, meanwhile memory-chip manufacturer Kioxia prepares to list American Depositary Shares.
Last year, it was reported that Rakuten Group’s Rakuten Card division was considering an American listing.
(source: Reuters)
