JIN-168 -- Plenty of (Small) IPOs Planned for 2002

J@pan Inc Magazine Presents:
T H E J @ P A N I N C N E W S L E T T E R
Commentary on the Week's Business and Technology News

Issue No. 168
Wednesday, February 13, 2002


++ Viewpoint: Plenty of (Small) IPOs Planned for 2002

++ Noteworthy News
- Ministry Tells NTT, Yahoo! BB to Improve Customer Service
- Government Quietly Orchestrating Snow Brand Bail-Out
- Tokyo Police Find Lethal Air Guns Sold over Net
++ Events


Economist Conferences presents:
Japan and international marketing strategy
March 13th 2002, Tokyo

Are you responsible for building global brands in Japan?
Hear case studies from international success stories and local
marketing dynamites including:

Win a free ticket for attending this roundtable, please register at

For more details, please visit

++ VIEWPOINT: Plenty of (Small) IPOs Planned for 2002

Japanese financial markets handled 169 initial public offerings in
2001, while US markets saw just 98 IPOs. What's going on here? We
called Tom Sato of Tokyo IPO to find out.

Sato's Tokyo IPO Web site (http://www.tokyoipo.com) focuses solely
on companies planning, launching or just finishing their IPOs. When
we called him, an IT company selling dealing systems and software to
the financial sector -- Simplex Technology -- had just launched on
Jasdaq. Its IPO price was 192,000 yen, but its opening price was
999,000 yen. Not bad, huh? "It's outrageous," Sato said. But
Simplex's launch is also typical of Japan's IPOs; despite the huge
rise in share price, Simplex raised a modest 672 million yen on its
launch. Japanese IPOs "have small financing, few shares, and demand
quickly outstrips supply," Sato said. "In the US, where the IPO
market is mature, if the deal is under $50 million, underwriters
aren't interested. But in Japan, they are quite interested."

The fact that Japan's IPOs are smaller than those in the US comes as
no surprise. Financial markets in Japan such as Mothers and Nasdaq
are just starting to mature after rocky starts. But why so many IPOs
in this beat up economy? "Companies are desperate to get on the
market because they can't get loans from banks," Sato said.

He said 2002 will be a strong year for IPOs in Japan, with
150 to 160 likely to take place. "We won't see big IPOs," he said,
"but there will be a whole bunch of small IPOs out there. That's
because the market is so fragile. It's a bargain market at the

And where are the best bargains? Sato listed a few hot sectors:
niche IT companies, real estate firms, entertainment and services.

-- Bruce Rutledge

"Putting Your Money Where Your Mouth Is" by Tom Sato from the
October 2001 issue: http://www.japaninc.com/article.php?articleID=26

New York City - March 12, 2002
An all-day forum featuring presentations by promising Japanese
companies seeking foreign investors and business partners. Hear
from leading experts on how to manage the transaction process and
the investment opportunities arising as a result of current economic
trends in Japan. This event is sponsored by Sonnenschein Nath &
Rosenthal and organized by KWR International, Inc. and Morgen, Evan
and Co., Inc.

For company profiles, additional information and a registration form
allowing complementary admission to qualified participants, please
or contact: jsciconference@kwrintl.com.

(Long URLs may break across two lines.)

** Ministry Tells NTT, Yahoo! BB to Improve Customer Service

Extract: The Japanese press reported this week that the
Telecommunications Ministry issued an administrative order for NTT
East and West and BB Technologies, part of the Yahoo! BB
family, to improve customer service when it comes to connecting and
disconnecting digital subscriber line (DSL) services. The ministry
said the average time it took a customer to cancel a contract with
NTT and establish an ADSL hookup with BB Technologies was 27 days.

Commentary: Here's one example of the black hole consumers can fall
into as NTT and Yahoo! battle over ADSL turf. A friend wanted to
sign up for Yahoo! BB's ADSL service, but she had to switch the name
on her NTT phone line before she could transfer it. NTT insisted
that she had to have a copy of her family register and other
documents to change the name. No substitute would do, and faxes or
emails would not be accepted. Needless to say, this working mother
didn't really have the time to run around gathering the documents,
so days ran into weeks, and she still hadn't had time to change the
name over. Meanwhile, she had applied for Yahoo! BB's ADSL service,
and the company periodically sent her emails reminding her that she
needed to present documents at the NTT office before she could get
the ADSL services. She sent an email back saying she was working on
it, but the emails from Yahoo! were automatic, and they just kept
coming. So there she was, stuck in the middle, too many humans
blocking her way at NTT, too few humans at Yahoo BB!, and still no
ADSL service in sight.

"Broadband Wars" from December 2001 issue:


J@pan Inc magazine produces three other newsletters:

++ Wireless Watch (WW): Mondays -- A weekly digest of news
and commentary focusing on Japan's wireless industry. Stay up to
date on i-mode, 3G phones and everything else wireless with WW.

++ Gadget Watch (GW): Thursdays -- Looks at the latest gadgets
being rolled out in Japan and is the perfect newsletter for gadget
freaks. Note, however, that we're not responsible for any cases of
"Japan gadget envy" that develop -- in many cases the products
you'll read about are available only on these shores.

** Music Media Watch (MMW); Tuesdays, A brand-new addition to J@pan
Inc's collection of weekly newsletters. MMW provides in-depth news
and commentary on the major developments in Japan's fascinating and
fast-moving music media industry.

Subscribe, unsubscribe, and find out more at:

We don't sell our lists to spammers, so breathe easy.

** Government Quietly Orchestrating Snow Brand Bail-Out

Extract: The Financial Times reported today that the Japanese
government is quietly planning a bail-out of Snow Brand, the food
and dairy products group that has been caught switching the labels
on beef. The FT says three agricultural co-ops are likely to step in
to save the beleaguered company.

Commentary: This stinks more than a carton of rotting [[wagyu]].
Just a week ago, an Agriculture Ministry official worried aloud
about the prospect of a foreign company buying out and
rehabilitating Snow Brand. God forbid! I can't think of a better
example of a company that ought to be allowed to fall flat on its
face. But a co-op official told the FT that Snow Brand is "vital for
Japan's dairy industry." I think I'm becoming lactose intolerant.

-- BR

Ever wonder where cutting edge companies like LINC Media's J@pan Inc
turn for Web and IT Solutions? IBM? EDS? Think again! Try HydraNet,
the fastest growing IT Consulting Firm in Japan. HydraNet
specializes in database development with a focus on streamlining
your business. Our motto is "Twice the Speed... Half the Cost." The
Content Management System we built saves J@pan Inc magazine 40 hours
a month! What can we do for your business? Call us now at
81-3-5456-5314. Email sales@hydranet.com or visit


** Tokyo Police Find Lethal Air Guns Sold over Net

Extract: The Tokyo Metropolitan Police have found M29 air guns being
sold over the Internet, the Daily Yomiuri reported. Production of
the M29s was banned 16 years ago because they were thought to be
lethal. The guns, which fire plastic bullets, are modeled on the .44
Magnum Clint Eastwood carries in the Dirty Harry movies.
Investigators found that the guns could also fire live ammunition.

Commentary: This news comes a week after The New York Times and many
Japanese newspapers reported that Japan's National Police Agency is
pushing for adoption of a licensing system for Internet auctions
here and abroad. People hawking illegal goods over the Net in Japan
may want to think twice; they may just become part of the NPA's
Exhibit A.

From the Daily Yomiuri newspaper:

From ONLY 6,250 yen per month.

The ULTIMATE business resource you can't afford to miss out on.
For more information, please go to:
http://www.japaninc.com/directory, mail:
fabien@japaninc.com, or call:
03-3499-2175 ext.1709

2002 Asian Venture Forum/Japan
The Four Seasons Hotel, Tokyo
March 4-6, 2002
Opportunities in Japanese Private Equity: A Contrarian View

With Japan still groping its way through the lost decade searching
for growth, yet another "recession" is barring its path. The macro
picture looks gloomy but opportunities for private equity investors
have never been brighter. 2002 AVF/Japan will explore this
contrarian view on Japan. With more than 350 delegates attending
last year, AVF/Japan is a MUST go event for the serious Asian
private equity investor.

For the latest details, please download our online brochure at:

SUBSCRIBERS: 5,051 as of February 13, 2002

Written by Bruce Rutledge (bruce@japaninc.com) and Sumie Kawakami

Edited by J Mark Lytle (mark@japaninc.com)

Subscribe at:

JIN online archive:

To UNSUBSCRIBE to this newsletter, click here:

For information on advertising in this newsletter,
contact: ads@japaninc.com

Send letters to the editor to:

Please contact us with any problems that arise:

(C) Copyright 2002 Japan Inc Communications KK. All Rights Reserved.