Amid the dearth of equity capital market transactions globally during 2008, Morgan Stanley was successfully involved in Japan's biggest initial public offering and the biggest follow-on deals of the year. The two Firm-led transactions recently received a string of awards from Asiamoney, Euromoney, FinanceAsia, Nikkei Veritas and The Asset.
The Seven Bank's ¥52.3bn (US$487mn) global IPO transaction, which Morgan Stanley acted as a joint global coordinator and joint global book runner, won "Best IPO" awards from Asiamoney, Euromoney, FinanceAsia and Nikkei Veritas.
In an extremely difficult market environment where most bank shares have plummeted amid the increasing credit impairment, the Firm managed to execute the transaction by emphasizing Seven Bank's unique business model - a provider of ATM-based cashing services in 7-Eleven stores and the other network of shops throughout Japan. With the Seven Bank's business model, fair valuation level and the Firm's active marketing effort, the offering met with heavy oversubscription of eight times. On the first day of trading, Seven Bank performed strongly, gaining 24 percent from its IPO price, against the decline in market indices for the day. This transaction marked the largest Japanese IPO in 2008 when the domestic IPO volume sunk by 60 percent year-on-year.
Morgan Stanley Japan also garnered accolades for the ¥417bn (US$4.5bn) Mitsubishi UFJ Financial Group global follow-on offering, which received Best Secondary Equity Offering awards from Euromoney, FinanceAsia and The Asset. Morgan Stanley acted as a joint global coordinator and joint book runner.
Representing the largest Japanese equity offering and the first capital raising through common equity by Japanese banks since January 2006, the deal captured robust demand from global institutions and retail investors with its international tranche covering 2.9 times oversubscription. With Morgan Stanley's extensive efforts to generate strong U.S. retail demand, the deal was recognized for having the largest U.S. retail allocation for a Japanese transaction to date.