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Dec. 2 (Bloomberg) -- Nikko Asset Management Co. postponed its initial public offering on the Tokyo Stock Exchange as the deepening European debt crisis fuels global market turmoil.
“As there is no need for the company to raise cash through an immediate listing, the company has decided that it is appropriate to suspend the listing during this time of market volatility,” Nikko Asset said in an e-mailed statement today. “The company will seek to resume its listing plans when market conditions are more stable.”
Global stocks plunged in the third quarter as the European debt crisis worsened, driving the MSCI World Index to its worst performance since the end of 2008. Japan’s benchmark Nikkei 225 Stock Average lost 11 percent in the three months ended September, the biggest decline in more than a year.
The IPO was initially planned on Dec. 15, Nikko Asset said in a statement to Japan’s finance ministry. The share sales in Japan and overseas were both suspended, it said.
Nikko Asset began choosing lead underwriters for its IPO in July, three people familiar with the plan said at the time, setting up the first debut share sale by a major Japanese asset manager in a decade as Japan’s equity capital market started to recover from the earthquake in March. Nikko Asset was preparing to list on the Tokyo exchange as early as March 31, according to the people in July.
Europe Crisis Escalates
The share sale was postponed “considering comprehensively the current stock market and other factors, which result from unexpected changes in the market conditions accompanied by a further escalation of the European sovereign debt crisis,” parent company Sumitomo Mitsui Trust Holdings Inc. said in a statement today.
Sumitomo Mitsui Trust shares climbed 1.2 percent to 244 yen at 12:36 p.m. in Tokyo. The Nikkei 225 was little changed.
Citigroup Inc., which acquired Nikko Asset from Nikko Cordial Corp. in 2008, sold the company to Sumitomo Trust as part of a transaction that valued it at 120 billion yen ($1.5 billion) in October 2009.
Nikko Asset, founded in 1959, employs more than 500 staff and has about 12.8 trillion yen under management. The investment management firm, run by Chief Executive Officer Timothy McCarthy, has subsidiaries in London, New York, Singapore and Sydney.
In Japan, Nomura Asset Management Co. and Daiwa Asset Management Co. are among investment companies that remain unlisted. Asset manager Sparx Group Co. listed on the Jasdaq exchange in 2001.
--Editors: Linus Chua, Russell Ward
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