December 31, 2010

INCJ Announces Its 9th Investment in 2010

Innovation Network Corporation of Japan announced its 9th direct investment in 2010. INCJ is to invest JPY 1.25 billion (USD 15 million) through a third party allotment to Nakamura Choko, a manufacturer of special precision components that utilize abrasion-resistance materials ( ). Nakamura aims to boost the sales of diamond saw wire products, which are used to cut solar power silicons and LED components. INCJ will assist Nakamura to capture a substantial global market share in this rapidly growing segment.

December 30, 2010

Blackstone Chief on Japan Investments

Blackstone has invested more than USD 2 billion in Japan in the past 6 months - Blackstone CEO Stephen Schwarzman confirmed in an interview with the Nikkei newspaper. The investments were primarily in commercial real estates. He cited cheap valuation and positive prospects for the Japanese economy as the attraction for investments. Mr. Schwarzman commented that Japan could grow nearly 2% next year, which is not bad for an economy with no population increase; and that a strong JPY currency and healthy balance sheets of Japanese corporations enable them to acquire foreign companies and assets very cheaply.

KKR, Morgan to sell Orient Corp Pref. Shares to Mizuho

KKR and Morgan Stanley are selling JPY 30 billion (USD 370 million) preferred shares of Orient Corporation, a consumer credit provider, to Mizuho Financial Group. Orient issued JPY 290 billion preferred shares after falling into a negative net worth in FY 2007. According to the Nikkei report, while Mizuho group obtained a large chunk of the issue, more than JPY 100 billion are held by Itochu Corp, the Development Bank of Japan, as well as Morgan Stanley and KKR. Conversion rights of the preferred shares kicked in last month and Mizuho aims to buy back shares to avoid dilution.

December 29, 2010

90% of Listed Companies in Japan Consider M&A

More than 90% of listed companies in Japan consider mergers and acquisitions as a key growth driver, according to a survey conducted by Nihon M&A Center Inc. Of the 196 respondents, which include manufacturers and non-manufacturers, 26% said they actively seek M&As, while 65.3% said they consider them if favorable deals come along; 46.7% said they have approached other companies for M&As over the last two years.

YTD 2010, total overseas M&As by Japanese companies were up 24% on the year at 367. Japan's resource-related acquisitions hit a record this year, totaling 35 deals with JPY 860 billion (USD 10.5 billion) according to Recof Corp. Meanwhile, M&As of Japanese businesses by Chinese firms came to 37, up 11 from a year earlier, while those by US firms remained little changed at 35. In monetary terms, M&As of Japanese businesses by U.S. firms are still far higher at JPY 194 billion (USD 2.4 billion) despite a 47% plunge from a year earlier. M&As by Chinese firms were still very modest at JPY 28.8 billion (USD 353 million).

December 27, 2010

Polaris to Purchase a Restaurant Chain Samukawa

Nikkei reported today that Polaris Capital will acquire restaurant operator Samukawa Food Planning Co. for an estimated JPY 6-7 billion (USD 73-84 million). Samukawa Food operates a total of 74 eateries through 7 restaurant chains in Tokyo and several major cities in Japan (eg., and Polaris will purchase all Samukawa shares from its founding family and the acquisition will be financed partly by a loan from Tokyo Star Bank. The current CEO, Mr. Samukawa, will remain in charge and Polaris aims to list the company within 4 years. Samukawa's latest sales and operating profits were reportedly JPY 11 billion (USD 133 million) and JPY 1.25 billion (USD 15 million). For Polaris, this is the first deal since July 2008. Polaris invested in 3 deals in 2008 (Nippon Oil Pump, Showa (pharma) and Aucnet) and exited from Q'sain earlier this year.

December 22, 2010

Sumitomo Group To Set Up The PE Firm

Sumitomo Mitsui Banking Corporation, Sumitomo Corporation and The Sumitomo Trust & Banking Co., Ltd announced that they had, either directly or through a subsidiary, made a joint contribution to private equity investment management company "Rising Japan Equity Inc." Rising Japan Equity will manage a 30 billion yen fund to carry out buy-out investments.

December 16, 2010

Kansai Paint To Launch Bid for South African Firm

Kansai Paint Co., one of the two largest Japanese paint manufacturers, announced that it will make a takeover bid for major South African Paint maker Freeworld Coatings Ltd., in order to make it a wholly owned subsidiary. Kansai Paint already has a 27.6% stake in the Johannesburg-based firm.

December 15, 2010

BOJ Tankan Shows Business Sentiment Deteriorated

The Bank of Japan Tankan survey showed that Japanese manufacturers' business sentiment worsened for the first time in nearly two years in the last quarter of 2010. Business managers were concerned with the impacts of the surging yen and slowing overseas economies. The end of government subsidiaries for environmentally friendly vehicles and a down scaling of the government-led eco-point program have apparently been a blow to related industries. However, the decline was less than had been expected by many economists.

December 14, 2010

Gold-Pak To Go Private With iSigma

Gold-Pak Co., LTD. a Nagano-based beverage manufacturer, announced that Gold-Pak approved the take-over bid from an investment firm set up by iSigma Capita, a middle-market buyout firm and a 100% subsidiary of Marubeni Corporation. The investment firm made the bid at 1641 yen, a 56% premium over its 3-month average. Phoenix Capital, Gold-Pak's largest shareholder, and Tokyu Corp., the second largest shareholder, agreed to accept the bid.

December 13, 2010

Failed Takefuji To Take Bids For Rehab Sponsor

Takefuji Corp., a bankrupt consumer lender, will start the selection process for a rehabilitation sponsor by asking interested parties to submit the proposal, according to Nikkei. The company has received letters of interest from 20 or so firms/funds as of late October.

December 09, 2010

Japan's Q3 GDP Revised Up To 4.5%

The Japanese Cabinet announced that real gross domestic product grew an annualized 4.5% during the July-September period, exceeding the 3.9% rise initially estimated a month ago. Consumption and capital expenditures proved stronger than initially thought. But many economists already expect a contraction in the fourth quarter due to slowing exports.

December 08, 2010

Dainkin In Talks To Buy Goodman

Daikin Industries Ltd., a top-ranked Japanese air conditioner maker, is considering various options for possible mergers and acquisitions in the US. Goodman Global Group is one of the targets, according to Nikkei. Goodman is held by Hellman & Friedman LLC, a San Francisco-based private equity firm.

December 07, 2010

BoT-M'bishi UFJ To Team With Dutch Investment Promotion Agency

The Bank of Tokyo-Mitsubishi UFJ, Ltd.(BTMU) and the Netherlands Foreign Investment Agency (NFIA) signed a cooperation agreement to promote foreign direct investment in the Netherlands. The agreement is expected to be mutually beneficial. The NFIA will be able to leverage BTMU's network for marketing in the Netherlands by Japanese companies while the NFIA's support will enable BTMU to strengthen its capabilities in the provision of quality information and services to Japanese companies.

December 06, 2010

Invoice To Go Private Via MBO With MBK

Invoice Inc., a listed service provider of consolidating billings, announced that it will accept a tender offer by an investment company set up by MBK Partners. It will launch the tender offer at 1500 yen which is a 37% premium over its 3-month average. Sumitomo Mitsui Bank will offer up to 12.5 billion yen in financing. MBK is an independent private equity firm specializing in the East Asia region.

December 01, 2010

Orix To Buy Stakes In Vietnamese Investment Firm

Orix Corp., a lease-oriented conglomerate, has acquired a capital stake in Indochina Capital Corp., an investment firm that specializes in Vietnamese real estate, equities, and infrastructure, according to Nikkei. Orix plans to develop large hotels and office buildings in Ho Chi Minh City, Hanoi, and elsewhere with Indochina Capital.