McDonald's set for Japan share debut

McDonald's Japan will offer shares to the public later this month

By staff and wire reports

TOKYO, Japan -- Fast food operator McDonald's Co (Japan) on Thursday set a tentative price range of 3,000 to 4,300 yen (about $24 to $34.50) for its initial share offer later this month.

McDonald's Japan is issuing 12 million new shares and will also offer 14.2 million existing shares to the public.

The company is a 50-50 joint venture between U.S.-based McDonald's Corp and Fujita Co, controlled by Japanese billionaire Den Fujita.

Fujita has been president of McDonald's Japan since its formation in 1971. The company is Japan's biggest hamburger chain operator, with about 60 percent of the market.

Fujita and McDonald's Corp signed a new license agreement in January 1999 which extended their partnership through to 2030.

Japan is the largest market outside the U.S.

The share offer is one of the biggest this year in Japan, which is the largest McDonald's market outside the U.S.

The price range was widely expected after McDonald's Japan said in its prospectus it expected to raise $338 million (42 billion yen) by issuing 12 million new shares. This is calculated at 3,500 yen per share.

If the initial public offer price is set at the top end of the range, the Japanese unit will raise 51.6 billion yen. The price at the lower end will raise 36 billion yen.

The final price will be decided on July 16 through a book-building method, in which institutional investors indicate the number of shares they are willing to buy and the price at which they would purchase them.

McDonald's Japan is scheduled to list on the JASDAQ market, formerly known as the over-the-counter market, on July 26. It will be the first among the global units of the U.S. parent to go public.

Reuters contributed to this report.