Japan delays tobacco sale


Though Japanese stocks have held up relatively well this year, they are still suffering from the global selloff

TOKYO, Japan -- Japan's government will put off its sale of Japan Tobacco Inc. shares due for July, according to reports.

The finance ministry will put off the sale due to the poor shape of the markets, the Nihon Keizai Shimbun reported on Tuesday.

The government originally planned to sell 333,000 shares in JT, its first sale of that company's stock in six years.

A new law requires the government to reduce its holding in the company to 50 percent, from 67 percent now.

The sale will likely be put off until September or later, unless the market improves dramatically. The ministry feared that offloading the shares would put a drag on the Tokyo equity market in general.

Other delays likely

The ministry is also likely to delay other sales such as its plan to reduce its ownership stake in Nippon Telegraph and Telephone Corp.

NTT on Tuesday upgraded its profit outlook for the year to March due to its sale of shares in its subsidiary NTT DoCoMo. It now expects a parent company profit of 100 billion yen ($833 million), up from 15 billion yen.

Postponing the JT and NTT sales could pose problems for the finance ministry. It had counted on raising over 580 billion ($4.8 billion) from the stock sales, money it planned to use to redeem Japanese government bonds.

In June, the government sold off its last shares in East Japan Railway Co., raising 266 billion yen ($2.2 billion). It is also prepping the sale of its remaining interest in West Japan Railway Co.

Japan Tobacco stock is down 2.38 percent early on Tuesday afternoon. That's on a day almost all stock markets in Asia are moving ahead.

The broader Tokyo market, as measured by the Topix, is up 2.09 percent.