GMO Internet expects extraordinary profit of JPY 37.4 billion due to sale of shares in GMO Payment Gateway

Maria Nikolova

GMO Internet has completed the transfer of the stock of the GMO-PG, and the sales price is determined.

There has been an update to FinanceFeeds’ report from earlier this week about plans by Japanese online services provider GMO Internet Inc. (TYO:9449) plans to reduce its shareholding in GMO Payment Gateway, Inc.

Today, GMO Internet says that it has completed the transfer of the stock of GMO-PG, and the sale price is determined. The sale price is put at JPY 38.363 billion.

GMO Internet expects to record an extraordinary profit (gain on sales of shares of subsidiaries and associates) of JPY 37.4 billion on individual accounts due to the sale of shares in FY2018. However, since GMO-PG will still be a consolidated subsidiary of GMO Internet, the transaction will have a limited impact on the consolidated results.

GMO Internet said it will sell 7,200,000 common shares or 9.7% of the total number of voting rights in GMO-PG. The sale will be conducted via over-the-counter (OTC) transactions with SMBC Nikko Securities Inc, which will resell the stock immediately after the transfer of the stock.

Regarding the purpose of the sale, GMO Internet explained that it reflects the necessity to enhance the financial base further by being cash-rich and maintaining an appropriate capital level. Taking into account various points, including the market value of assets and liquidity, GMO Internet has made the decision regarding the transaction.

Following the transaction, GMO Internet’s ratio of voting rights of GMO-PG will decrease from 51.7% to 42%.

In September this year, GMO Internet said it would sell a part of its stake in its subsidiary GMO Financial Holdings Inc (TYO:7177). As a result of the transaction, GMO Internet will still hold more than 50% of the total number of voting rights of GMO Financial Holdings.

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