Going public sixty-nine years after founding (2000)

What did listing actually buy?

The motive president Goto Yasuo gave for listing was not a shortage of money but a strengthening of constitution. When a company’s borrowing already covers its needs, the reason to go to the market lies less in the funds themselves than in the people required to start something new and in the discipline of being watched from outside. Seven years after chairman Goto Isokichi said in 1993 that separating management from capital would become necessary sooner or later, the listing was carried out calmly, at a time of the company’s choosing. That it was not a capital measure forced by crisis is what defines the character of this decision.

What remained after the listing, however, was a structure in which foundations and a holding association connected to the founding family continued to hold close to a majority of the shares. Disclosure increased under the market’s gaze, but the routes by which shareholders might act on management stayed limited. The aseptic rice business into which the listing proceeds were invested was impaired within six years, and the search for the next pillar moved on to a debt-funded acquisition. Whether going public worked as a device for changing the company’s culture is a question that can still be re-asked.