The planned acquisition of a Tokyo Stock Exchange-listed company by a Hong Kong-based cryptocurrency firm is reportedly raising concerns within the bourse.
The Tokyo Stock Exchange (TSE) is receptive, even welcoming, to foreign firms entering the Japanese market – unless they’re a cryptocurrency firm.
According to the Nikkei on Sunday, the exchange operator is evidently sweating over the prospective takeover of Beat Holdings, a company listed on its bourse by Noah Ark Technologies, a Hong Kong company reportedly looking at launching cryptocurrency exchanges in Japan and other jurisdictions alongside plans for an ICO launch.
As a shareholder of the TSE-listed company, Noah Ark had previously proposed Beat Holdings to change its name to include the latter’s token cryptocurrency ‘Noah Coin’ in June, according to the report.
Further, Noah Ark also proposed that the company issue new shares and open up its acquisition rights to enable the latter gain 50% voting rights in Beat, a company registered in the Cayman Islands with a focus on acquiring intellectual properties (IPs) and healthcare. Beat currently sees a market cap of 7.3 billion yen ($66 million) while trading on the TSE’s second section for mid-sized companies.
The Hong Kong company is eyeing the acquisition to launch crypto exchanges in ‘Japan, the U.S., China and some European markets, as well as secure about $1 billion’ through an ICO that will see the company release its ‘Noah Coin’, an excerpt from the report added.
The TSE, while having no means of stopping the purchase, is reportedly feeling distressed at these proceedings. A TSE official told the Nikkei that the bourse felt “troubled, to be honest” by the goings-on as it continues to largely stay away from the cryptocurrency sector which it perceives lacks investor protections. The report adds that Noah hasn’t been approved as a crypto exchange operator in Japan by authorities, even though its unclear if the company has formally applied yet.
Beat and its own shareholders are also resisting Noah Ark’s planned takeover as Beat CEO Lian Yin Hanh claimed the latter is only seeking to buy its way into the TSE to benefit from the credibility of a listing in the TSE, Asia’s largest stock exchange operator. Lian told the Nikkei that Noah is likely to launch an ICO in Singapore or Hong Kong, markets wherein Beat has already established a presence.
Noah is currently Beat’s biggest shareholder with a 15% stake and the latter’s management rights are to be decided at a shareholders’ meeting in September.