The Japan Fair Trade Commission (JFTC), the anti-monopoly watchdog, has begun investigating if securities companies and underwriters are pricing shares fairly in initial public offerings, Nikkei has learned.
The move comes after the body noted that in many deals, the difference in offer prices before listing and opening share prices on debut have been larger than in Europe and the US.
As a result, the listing company raises a smaller amount of capital, but investors come away happy with what is known as a “first-day pop.” Underwriters are known to be partial to this practice in order to garner financial support from investors. However, from the JFTC point of view, the investigation could open the way for underwriters to increase pricing for startups and allow them to raise more funds, given that Japan lags behind the rest of the world in nurturing young tech companies.
JFTC sent a questionnaire to about 100 domestic companies to ask if they felt they were able to sufficiently negotiate with underwriters in setting offer prices for their shares and if they were satisfied with the process. JFTC will also interview underwriters if it felt it necessary.
Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.
Featured News
Attorney Challenges NCAA’s $2.78 Billion Settlement in Landmark Antitrust Cases
Oct 3, 2024 by
nhoch@pymnts.com
Former DOJ Antitrust Chief Megan Lewis Joins McGuireWoods as Partner
Oct 3, 2024 by
nhoch@pymnts.com
Tech Rivals Push for EU Crackdown on Microsoft Edge Dominance
Oct 3, 2024 by
CPI
Pork Industry Faces Legal Challenges as Antitrust Lawsuits Against Seaboard Foods Dismissed
Oct 2, 2024 by
CPI
CMA Strengthens Investigation with Advisory Panel of Veterinary Experts
Oct 2, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Refusal to Deal
Sep 27, 2024 by
CPI
Antitrust’s Refusal-to-Deal Doctrine: The Emperor Has No Clothes
Sep 27, 2024 by
Erik Hovenkamp
Why All Antitrust Claims are Refusal to Deal Claims and What that Means for Policy
Sep 27, 2024 by
Ramsi Woodcock
The Aspen Misadventure
Sep 27, 2024 by
Roger Blair & Holly P. Stidham
Refusal to Deal in Antitrust Law: Evolving Jurisprudence and Business Justifications in the Align Technology Case
Sep 27, 2024 by
Timothy Hsieh