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Kioxia, the artist formerly known as Toshiba Memory Corporation, postpones IPO
Blames market volatility caused by pandemic and US controls over Huawei
Kioxia, the flash and SSD fabrication artist formerly known as Toshiba Memory Corp, has called off its initial public offering due next month, citing stock market volatility and the coronavirus outbreak.
The proposed listing price for the shares was due to be released today, ahead of the 6 October flotation, but instead the company confirmed the IPO has been postponed. The price was expected to have valued the organisation at circa $16bn.
Nobuo Hayasaka, president and CEO, said in a statement: "While we received significant interest from many investors, the lead underwriters and Kioxia do not believe it is in the best interest of current or prospective shareholders to proceed with the IPO at this time of continued market volatility and ongoing concerns about a second wave of the pandemic."
The exec didn't put a new date or time frame for new listings, merely stating: "We will revisit an IPO at an appropriate time. We are not in a rush."
In addition to the coronavirus, the controls levied over strategic Kioxia customer Huawei by the US government, and a smaller-than-expected share price, were also believed to have played a part in postponing the IPO, according to the Nikkei Asia Review.
Kioxia, previously known as Toshiba Memory Corporation, was renamed following an intensive workout by its new owners in the bowels of the strategy boutique in 2019.
The business was sold by Toshiba during the prior year for $18bn to a consortium led by Bain and including SK Hynix, Apple, Dell Technologies, Seagate Technology, and Kingston Technology.
It has been a relatively busy September for IPOs, what with Sumo Logic and JFrog listing, along with Snowflake's $33bn debut on the New York Stock Exchange. And lest we forget – for it was eminently forgettable – Rackspace Technology did the deed in August.
However, Kioxia's decision to delay the stock flotation might not be a bad idea, if concerns expressed by Bernstein, an influential Wall Street analyst, are to be heeded: there are similarities between the stock market dynamics in 2020 and 2001 when the .com bubble burst, it warned. ®