Search Mark
Home / Industry Dynamics

Japanese Banks Embrace Hostile Takeovers Following New Guidelines 

Today’s News 

Akihiro Fukutome, head of the Japanese Bankers Association, stresses the importance of evaluating unsolicited proposals for their potential to bolster the target company's long-term value. 

Image Source: Bloomberg
Akihiro Fukutome, head of the Japanese Bankers Association, stresses the importance of evaluating unsolicited proposals for their potential to bolster the target company’s long-term value. 
Image Source: Bloomberg 

Japanese banks are showing a newfound openness towards financing hostile takeovers, a shift attributed to the government’s recent revision of takeover guidelines.  

Akihiro Fukutome, the newly appointed head of the Japanese Bankers Association, highlighted this change in an interview, stating that “Banks were previously worried about reputational risks” in helping unsolicited bids. He also said that “But I believe new takeover guidelines from the industry ministry last year have helped lower psychological hurdles.”  

Fukutome’s remarks underscore a significant departure from Japan’s traditional approach to dealmaking, bringing the country closer to Western norms in the corporate arena. 

The Ministry of Economy Trade and Industry (METI) implemented new M&A guidelines aimed at curbing excessive defensive tactics and eliminating the stigma surrounding hostile bids, thereby encouraging corporate takeovers.  

While hostile bids remain relatively uncommon, their frequency is on the rise. Companies like electric motors manufacturer Nidec and life insurer Dai-ichi Life Holdings have already capitalized on the new guidelines, initiating hostile takeover bids in response to the changing landscape. 

Fukutome, who also heads the core banking arm of Sumitomo Mitsui Financial Group, emphasized that banks should assess unsolicited proposals based on their potential to benefit the target company and enhance its long-term value. 

He noted a shift in the atmosphere surrounding unsolicited bids, citing an increase in such deals in their pipeline. Over the past year, Japan has seen three hostile takeover proposals, including Brother Industries’ bid to thwart a management buyout at Roland DG, according to LSEG data. 

Daiwa Securities Group, a prominent Japanese investment bank, has expressed willingness to advise hostile acquirers if the proposed deal would benefit the target company or its industry. This evolving stance among Japanese banks and financial institutions reflects a broader transformation in the country’s corporate culture, signaling a departure from the traditional aversion to hostile takeovers and a growing acceptance of strategic acquisitions for long-term growth and competitiveness. 

Other News

Fed Stresses Patience On Rate Cuts Amid Strong Growth 

Federal Reserve Chair Jerome Powell underscores the central bank’s cautious approach towards interest rate cuts, citing robust economic expansion as grounds for patience. 

Syngenta Scraps USD 9B IPO In China Amid Regulatory Hurdles 

Agricultural powerhouse Syngenta halts its long-awaited USD 9 billion IPO in Shanghai, citing uncertain market conditions and regulatory hurdles, further dampening China’s struggling IPO landscape. 

Climate Scientist’s Stand On LNG Disrupts Oil & Gas Industry 

Robert Howarth’s research, influencing White House policies on LNG exports, incites industry backlash and underscores contentious debate on fossil fuel’s role in climate change mitigation. 

Share to

Industry Dynamics

Yen Soars to 6-Week High Amid Speculation of Intervention

On Thursday, the Japanese yen reached a six-week high, fueling speculation about possible government intervention. This development comes as the dollar faces widespread declines in anticipation of potential U.S. interest rate cuts in the coming months.

2024-7-18 | Industry Dynamics

Cold Storage REIT Lineage Aims USD19.2 Billion IPO Valuation

Lineage Logistics, a cold storage real estate investment trust (REIT), announced it is targeting a valuation of up to USD 19.16 billion in its upcoming U.S. IPO, potentially making it the largest listing of the year.

2024-7-17 | Industry Dynamics

Warren Buffett's Berkshire Hathaway Hits Record High

Berkshire Hathaway's stock reached a new peak on Monday, signaling robust investor confidence in Warren Buffett's stewardship.  

2024-7-16 | Industry Dynamics