Tokyo: Tokyo Stock Exchange Inc is looking to strengthen its market for initial public offerings (IPOs) by pitching itself as a venue for cross-border listings by startups in Asia.
The exchange is offering help in fundraising and IPO preparations with partners including banks, auditors and venture capital funds in Asia.
So far, 20 startups have been chosen for the initiative, its website shows, with half of them based in Singapore and Taiwan.
IPOs have been booming across the region, with India setting a record last year and Hong Kong proceeds at a multi-year high.
Tokyo is looking to carve out its own slice of the market, counting on its deep pools of liquidity being attractive for companies that are too small for the US market and are concerned with geopolitical risks in Hong Kong.
“We are looking to have as many companies whose shares keep rising over a long period as possible and that’s not limited to Japanese firms,” Tokyo Stock Exchange president Moriyuki Iwanaga said.
The plan may result in more than 20 cross-border IPOs in the next three years, according to Mitsubishi UFJ Trust and Banking Corp, one of the partners in the initiative.
That compares with just four such deals between 2023 and last year, according to the bourse’s website.
“Liquidity after listing is significantly important for companies as managements engage with shareholders and stakeholders to raise corporate value,” said Atsushi Takahashi, a senior manager at the trust bank.
Tonik Financial Pte, a Mizuho Bank Ltd-backed digital bank based in the Philippines that joined the Tokyo Stock Exchange’s initiative, is actively exploring listing in Tokyo in the next two or three years, founder Greg Krasnov said, citing the access to liquidity and investor base specifically. — Bloomberg
