By Osamu Tsukimori, CBS MarketWatch.com
TOKYO (CBS.MW) -- Japan's two online brokerages, E-Trade Securities Co. and kabu.com Securities Co. are get ready for initial public offerings on the Jasdaq over-the-counter market and the Tokyo Stock Exchange, according to a published report.
Both companies are expected to issue new shares when they go public, the Nihon Keizai Shimbun reported Monday, and they plan to use the proceeds to bolster loans to customers engaging in margin trading in a bid to boost earnings.
E-Trade Japan, Japan's largest online broker by accounts and assets under management, is set for an IPO as early as November with Nomura Securities Co. /zigman2/quotes/206251373/delayed JP:8604 +0.78% /zigman2/quotes/207276383/composite NMR -1.35% serving as the lead manager, the report said.
Softbank Investment Corp. /zigman2/quotes/200067066/delayed JP:8473 -0.98% and its investment funds are major E-Trade shareholders and they had a combined 100 percent stake in the brokerage at the end of June, company documents show.
E-Trade Japan has a licensing agreement with U.S.-based E Trade Financial Corp. /zigman2/quotes/210213433/composite ET -4.26% .
Meanwhile, another major online brokerage, kabu.com Securities Co., is expected to debut on the Tokyo Stock Exchange by early next year, the report added.
Kabu.com is owned more than 30 percent by Japan's fourth-largest lender UFJ Holdings and major trading house Itochu Corp. /zigman2/quotes/204146563/delayed JP:8001 +2.36% /zigman2/quotes/207721067/composite ITOCY +1.46% .
The two securities also plan to allocate the money gained through the offering toward futures system upgrades and potential mergers and acquisitions, the report said.
Shares of Softbank Investment ended up 0.4 percent, UFJ Holdings fell 1.6 percent and Itochu eased 0.4 percent in Tokyo. The Nikkei Average lost 0.2 percent.