Rakuten Bank Soars On Its Debut, Raising $625 Million In Japan's largest IPO In Years

Rakuten Bank Ltd shares jumped more than a third in their market debut on Friday, after the internet bank raised $625 million in Japan's largest IPO in more than four years.

In Tokyo, shares were fetching 1,914 yen after being untraded for the first hour of the morning session due to a flood of buy orders. The shares reached a high of 1,937 yen, a 38% premium over the reduced IPO price of 1,400 yen.

This month, Japan's largest internet bank by number of accounts priced its IPO at the top of its reduced range, raising approximately 83.3 billion yen ($625 million), minus a "greenshoe" option for more shares.

It had initially set a price range of up to 1,960 yen per share for the IPO but then reduced it by about 30%.

Sources reported on Thursday that Rakuten modified its IPO prospectus as investors demanded more information about the risks associated with its connection to loss-making parent Rakuten Group Inc.

The IPO provides much-needed capital to e-commerce firm Rakuten Group, which has been losing money for four years due to the costly build-out and challenges of its mobile phone business.

Rakuten amended its IPO prospectus after investors pushed for details on the risks from its exposure to money-losing parent Rakuten Group Inc, Reuters reported on Thursday citing two people with knowledge of the matter.

The IPO marks a much-needed cash boost for e-commerce firm Rakuten Group, which has seen four years of losses from the costly build-out and struggles of its mobile phone business.