Japan’s Nomura benefitting tremendously from Toyota new shares deal

Japan’s Nomura benefitting tremendously from Toyota new shares deal image

Japanese financial holding company Nomura Holdings Inc. has seen individual investor account openings jumping at more than twice the value seen last year in July as people came to buy the new Model AA shares sold by Toyota Motor Corp., the largest automaker in the world.

The brokerage house’s new figures have been reported by people that have insight knowledge, saying that at least 25,000 people opened new accounts during the first nine business days of the month, with a daily average of around 2,800, up from around 1,300 new accounts per day last year during the same period. The tremendous jump comes as the Japanese automaker, also the biggest company in the country, has retained Nomura as the exclusive venue for the sale of the 500 billion yen new type of stock recently issued, with preorders around three to five times higher than the number on sale, according to reports from other sources. The brokerage also deals with shares sold to retail customers from other Japanese powerhouses, such as Japan Post Holdings Co. and its banking and insurance units, while Sony chose it as the head underwriter for a 300 billion yen public offering.

The investors flocking to the new shares, named after the company’s first automobile, Model AA, will have to hold on to them for half a decade, with the securities yielding dividends along the way, with an option to sell them back to the company if the purchase value drops or convert them into common shares if it holds at the end of the period. The sale is especially attractive to aging Japanese citizens looking for limited risk and also yields returns that are higher than ones stemming from cash and bank deposits.

Via Bloomberg

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