Japanese Companies Spend 295 Trillion Won on M&A in First Half, Triple Last Year's Amount

Record-High M&A in the First Half
Driven by Corporate Restructuring and Sale of Non-Core Business Units

The Nikkei, citing market information provider LSEG, reported on July 10 that the amount spent by Japanese companies on domestic and international mergers and acquisitions (M&A) in the first half of this year reached an all-time high.

According to the Nikkei, the total value of M&A deals by Japanese companies in the first half of this year was $214.8 billion (approximately 295 trillion won), which is 3.6 times higher than the amount in the first half of last year. This is the highest figure for any half-year period since comparable statistics became available in 1980. This trend reflects the fact that Japanese companies are actively entering the global M&A market rather than remaining solely in the domestic market.

The share of Japanese companies in the total global M&A value also surpassed 10% for the first time since the second half of 1990. In 1990, Matsushita Electric Industrial, the predecessor of Panasonic Holdings, acquired the American film company MCA. This was a period when Japanese companies were prominent players in the M&A market.

The Nikkei pointed to several factors behind the recent surge in acquisitions by Japanese companies, including moves by large corporations to reorganize their business groups and the sale of non-core business units.

In fact, major corporations such as Toyota Motor are seeking to acquire Toyota Industries, which is at the root of the Toyota group, while NTT is considering acquiring all shares of its listed subsidiary NTT Data Group to convert it into a wholly owned subsidiary. The intention is interpreted as a move to implement management strategies and personnel decisions centered on the parent company, without input from subsidiary boards or external shareholders.

The number of cases in which group affiliates or subsidiaries were sold in the first half of this year was approximately 270, an increase of about 30% compared to the previous year. Japan Tobacco (JT) decided to sell its pharmaceutical business to Shionogi Pharmaceutical in order to focus on its tobacco business.