SoftBank is thinking about listing its PayPay payments division on the New York Stock Exchange. If successful, this would be the second American listing for Masayoshi Son’s vast tech conglomerate after Arm, claimed a Reuters report quoting information from sources. 

Given the greater valuations that IT businesses often receive in New York compared to Tokyo, one of the insiders claimed that the city is considered as a more desirable location for listings. The date of the listing was still uncertain because PayPay, which now loses money, must first show that it has a clear route to profitability, according to the source.

A PayPay listing was previously a target for SoftBank, with one executive estimating its value at $7.17 billion in November. There hasn’t been any prior news about the corporation exploring a listing in the United States.

Representatives for PayPay and SoftBank Corp., the domestic telecom division of the SoftBank Group, stated that they would refrain from commenting on rumours. SoftBank Corp., its online division Z Holdings (4689.T), and the second Vision Fund of the consortium hold PayPay.

Due to the confidential nature of the information, all of the sources declined to be named.

Shares of SoftBank Group ended the day up 2%, with Z Holdings posting their highest one-day increase since February, rising over 6%.

It is uncommon to find Japanese companies listed in New York. The operator of the messaging app Line, based in Tokyo, had a dual offering in 2016 and eventually merged with SoftBank’s internet division. Syla Technologies’ debut in March is one of more recent instances, according to Dealogic.

“Z Holdings shares reacted on hopes that a U.S. listing might invite a premium valuation but recent domestic listings for Rakuten Bank and SBI Sumishin Net Bank indicate there is room for fintech listings locally,” said analyst Kirk Boodry at Astris Advisory Japan, who values PayPay at 800 billion yen to 900 billion yen.

Son, the founder of SoftBank, has promised to go into “offence mode” as interest and investment in artificial intelligence grow on a worldwide scale. He has been playing defence for a while, reducing his assets after the tech sell-off severely impacted the value of the companies in his portfolio.

More than 55 million individuals in Japan use PayPay, a company that provides QR code payment services, making it a dominant player in the congested digital payments sector.

It profited from a government-supported initiative to nudge consumers away from cash and towards digital payments, and it quickly expanded by providing aggressive rebates.

PayPay reported a loss of 11.9 billion yen before interest, taxes, depreciation, and amortisation in the fiscal year that ended in March, down from a loss of 43.2 billion yen in the prior year.

By the March 2026 fiscal year, the telecoms group hopes to turn a profit for its banking unit, which includes PayPay. According to a user survey conducted by Mobile Marketing Data Labo, PayPay is the most popular mobile payment service in Japan.

To raise money in the wake of the decline in tech valuations, SoftBank is preparing an IPO for Cambridge, England-based chip designer Arm in the United States.

(Adapted from Reuters.com)

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