Medirom Healthcare Technologies Inc. , a healthcare services company that operates “Re.Ra.Ku” relaxation studios primarily in the Kanto region, has received approval for its planned IPO on Nasdaq. Having recently completed its registration application with the SEC, the company is expected to list on Nasdaq as early as this month (December 2020).
If Medirom lists on Nasdaq, it will reportedly be the first Japanese company to list in the U.S. without first going public in Japan since IIJ in 1999, marking a 21-year gap. While numerous venture companies have been planning Nasdaq IPOs “under the surface” in recent years, Medirom has emerged to lead the way.
Medirom’s Registration Statement (Form F-1) is already publicly available on the SEC’s website, and reviewing it reveals several interesting facts.
Accounting Auditor "Skips Japan"
The accounting audit for Medirom was conducted by Squar Milner LLP, an accounting firm based in Irvine, California. Squar Milner had been a local Southern California-based accounting firm but merged just last month (November 2020) with Baker Tilly. Baker Tilly is a U.S. national accounting firm, ranking as the 12th largest in the nation, and also maintains a network and offices in Japan.
For Medirom’s audit, Squar Milner’s U.S. office conducted the audit directly, rather than using a Japanese network firm. It was previously believed that for a Japanese company to list in the U.S., it was necessary to be audited by a PCAOB-registered Japanese accounting firm—specifically, KPMG Azsa LLC, Ernst & Young ShinNihon LLC, PwC Aarata LLC (or PwC Kyoto), or Deloitte Touche Tohmatsu LLC—and that there were no other options. The establishment of this precedent, contracting directly with a U.S. accounting firm for the audit, can be seen as an expansion of options for Japanese startups considering a U.S. listing in the future.
Bookrunner is Maxim Group
The investment bank underwriting the IPO is Maxim Group LLC. Maxim is a New York-based investment bank, originally formed in 2002 as a spin-off from the U.S. subsidiary of Investec. While Maxim does not have a base in Japan, it also served as the bookrunner when FRONTEO (formerly UBIC) listed on Nasdaq. The amount to be raised in this IPO is $20 million (approx. 2.0 billion JPY), and Maxim plans to serve as the sole bookrunner.
Legal Counsel is Greenberg Traurig
The law firm is Greenberg Traurig, LLP. They also have a base in Japan (GT Tokyo Law Offices) and previously served as counsel for the aforementioned FRONTEO Nasdaq listing.
Costs Associated with the IPO
Please refer to the table below for the listing-related expenses paid in connection with Medirom’s public offering, other than underwriting discounts and commissions and expenses.
Items other than the U.S. Securities and Exchange Commission (SEC) registration fees, Financial Industry Regulatory Authority (FINRA) fees, and Nasdaq Capital Market(*) listing fees are estimates and may be subject to change due to future contingencies. The total cost is approximately 350 million JPY.
Furthermore, this IPO resulted in a market capitalization for Medirom of $77 million (approx. 7.7 billion JPY), with $12 million (approx. 1.2 billion JPY) in funds raised.
Breakdown | USD | JPY (Converted at 100 JPY/USD) |
U.S. Securities and Exchange Commission registration fees | 2,728 | 272,800 |
Financial Industry Regulatory Authority (FINRA) filing fees | 3,605 | 360,500 |
Nasdaq Capital Market(*) listing fees | 54,973 | 5,497,300 |
Accounting related fees | 1,411,828 | 141,182,800 |
Legal related fees | 1,719,774 | 171,977,400 |
Roadshow | 49,536 | 4,953,600 |
Printing fees | 253,149 | 25,314,900 |
Other | 92 | 9,200 |
Total | 3,495,685 | 349,568,500 |
(*)Nasdaq Capital Marketについては過去の記事をご参照ください。
Link
For questions or consultations regarding this page, please feel free to contact us using the inquiry form below.
