Kioxia has filed for an initial public offering (IPO) on the Tokyo Stock Exchange, aiming for an October debut, reports Nikkei. The NAND flash maker aims to raise at least $500 million and could be valued at over $10 billion, according to Financial Times. Even after the IPO, the company will be controlled by Bain Capital, SK hynix, and Toshiba.
Kioxia, the world's third largest supplier of NAND flash memory based on its performance in Q1 2024, as reported by TrendForce, has been seeking an IPO for a while and now that there is interest in stocks associated with the AI boom, it is time for its owners to capitalize on this. The company is currently 56% owned by a special-purpose entity created by Bain Capital and SK hynix (which can control up to 15% of Kioxia), while Toshiba retains a 41% stake. Both Bain and Toshiba intend to gradually reduce their stakes following Kioxia's public listing.
Despite its strong financials, Kioxia's $10.3 billion valuation is expected to be at a discount compared to Samsung and Western Digital. This discount reflects the company's position in the market (largely caused by its production-cutting tactics), its debt levels, and the need to offer attractive pricing to entice both global and domestic investors.
Kioxia's IPO will occur amid Western Digital's split into two companies: a NAND and SSD maker and a hard drive maker. After the split, Western Digital's NAND company will control around 12% of the global NAND memory supply, leaving Kioxia with another 12%. The two companies will be considerably behind Samsung and SK hynix, and even if they had merged, they would only be comparable to SK hynix in terms of NAND market share.
