Japanese overseas mergers and acquisitions (M&A) may surge this year as companies expand abroad to counter a stagnant domestic economy and try to cut the cost of climate change rules, Recof Corp said.
Hikari Imai, chief executive officer of the Tokyo-based M&A advisory firm, forecasts takeover and investment deals by Japanese companies abroad to increase by almost 30 percent to more than ¥3.6 trillion (US$39 billion) after a 62 percent decline last year, he said in an interview at his office yesterday
Declining local demand as Japan’s population ages and shrinks is prompting manufacturers to invest in countries such as China and India to survive, Imai, 60, said. Global climate-protection rules requiring businesses to cut greenhouse-gas emissions mean higher costs for companies, encouraging mergers to reduce the financial burden and stay competitive.
“There may be a 1 trillion yen cross-border deal sealed this year,” said Imai, a former vice chairman of Merrill Lynch Japan Securities, which advised Japan Tobacco Inc on its £7.5 billion (US$12.2 billion) acquisition of UK-based Gallaher Group Plc in 2007.
Imai said he expects food and beverage, energy and chemical companies to be involved in cross-border takeovers and investment this year. Trading houses may also seek access to overseas natural resources, he said. Japan imports 95 percent of its energy needs.
Overseas acquisitions by Japanese companies totaled ¥2.8 trillion last year excluding debt, the lowest in four years, according to data compiled by Recof. Corporate purchases overseas amounted to ¥2.64 trillion last year, according to data compiled by Bloomberg.
Recof ranked 65th in handling mergers in Japan last year, Bloomberg data shows.
The company advised on the merger of Shonai Bank Ltd and Hokuto Bank Ltd, two regional Japanese lenders, last year, Imai said. Nomura Holdings Inc was the No. 1 adviser, with a 34 percent market share.
The shift in Japan to cleaner energy prompted Nippon Oil Corp to merge with Nippon Mining Holdings Inc into the country’s largest oil-refiner, to cut operational costs and be competitive. The merger is expected to be completed in April.
Kirin Holdings Co, Japan’s biggest brewer by sales, led Japanese companies taking advantage of a stronger yen to buy overseas assets last year.
The company spent about US$4.6 billion to take full control of Sydney-based Lion Nathan Ltd and acquire almost half of San Miguel Brewery Inc in the Philippines.
“We expect a growing trend for Japanese companies, particularly manufacturers in mature industries, to make cross-border M&A deals aiming at expanding their overseas business,” said Keiichi Sugiura, director of Japan Buy-out Research Institute Corp in Tokyo.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last