Middle East War Affects IPO Pricing: Softbank's PayPay (PAYP.US) Listing in the US May Face "Bottom Pricing"

According to two informed sources, due to market volatility caused by the Middle East conflict, the initial public offering (IPO) of PayPay (PAYP.US), a payment company under SoftBank Group, may be priced at the lower end of the range. One of the sources stated that the IPO book for PayPay had received over 5 times oversubscription and is now closed, with the final pricing to be confirmed after the close of the US stock market on Wednesday. According to documents submitted this month, the Japanese payment app operator is issuing a total of 55 million American depositary shares, with a price range of $17 to $20 per share, targeting a valuation of up to $13.4 billion. One source mentioned that Tencent, Alipay under Ant Group, and Alphabet Inc. Class C have committed to participate in this IPO investment. The mentioned companies have not responded to requests for comments. PayPay has played a key role in encouraging Japanese consumers to move away from cash preferences by providing cashback offers on its payment app. It currently has over 70 million registered users. However, the company's path to IPO has not been smooth. Last week, it was reported that the IPO roadshow for PayPay was initially postponed due to market impact from the Middle East conflict. Previously, during the US government shutdown last year, PayPay had also delayed its IPO due to regulatory delays caused by the interruption in the submission of documents. Despite recent market volatility, the US IPO market is expected to see a significant rebound this year. Goldman Sachs Group, Inc. predicts that IPO fundraising in 2026 could double to a record $160 billion, with potential listings including Elon Musk's SpaceX, and the AI companies OpenAI and Anthropic. Following the successful IPO of Arm, PayPay will be the first US listing case of a majority equity investment by SoftBank. SoftBank took the chip design company public in 2023 with a valuation of $54.5 billion, which has since risen to nearly $130 billion. PayPay plans to list on the Nasdaq under the ticker symbol "PAYP". Goldman Sachs Group, Inc., JPMorgan, SMBC Nikko Securities, and Morgan Stanley are the joint bookrunners for PayPay's offering this time.