Japan Carbon Capture Startup’s IPO in 2027 ‘Not Off the Table’
(Bloomberg) -- TBM Co., a Japanese maker of carbon capture technology and recycled materials, has started preparatory work for an initial public offering on the Tokyo Stock Exchange’s Growth Market to list in the “not-so-distant future,” a company executive said.
An offering as early as 2027 is “not off the table,” Chief Financial Officer Seigo Nakashima told Bloomberg News in an interview this month. The company has already selected a lead underwriter and auditor and is currently gauging investor interest, he said, adding that any IPO would definitely not be next year.
The Tokyo-based startup is targeting a higher market capitalization than its current valuation of ¥136 billion ($868 million), Nakashima said. The company has a “clear path to achieving annual operating profitability” and is entering a phase of revenue growth, he said.
Regulators have been ratcheting up pressure on startups to gain more scale before debuting on the stock market. Roughly 68% of 615 companies on Tokyo’s Growth Market have market values of ¥10 billion or below, according to the exchange. The last startup that listed at more than ¥100 billion was Timee Inc., an on-demand job-matching app operator, which started trading in June last year.
Nakashima said funds raised through the offering are planned for overseas expansion and other investments. Past investors include Goldman Sachs Group Inc., Itochu Corp. and South Korea’s SK Group. The company wouldn’t provide a list of the current investors.
Founded in 2011, TBM has developed CR-LIMEX, a new material made from captured carbon dioxide emitted by power plants mixed with calcium-containing waste and recycled plastic. The material is sturdy enough to be used in construction. The company also sells recycled materials made from consumer waste such as plastic containers and packaging.
Demand for its products could increase with growth in the carbon reduction-related sector. Market researcher Fuji Keizai Group forecasts the global market for the industry to grow by over 17 times to almost ¥200 trillion by 2050, compared with 2023 levels.
In Japan, the company may also receive a boost from the government’s Green Transformation policy that aims to decarbonize the economy by mobilizing ¥150 trillion in public-private investment over a decade.
Nakashima said that TBM also plans to enter the carbon credit market, where firms can sell credits earned from reducing greenhouse gas emissions to companies that need them.
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