Japanese white knights

Nomura was the Japanese white knight that bought the European & Asian operations of Lehman Brothers last year. As Japan’s largest brokerage by revenue, its acquisition attempt is seen as an initial step for it to become a global player.

Further to a series of Japanese acquisitions in the West back in the 80’s, recently more Japanese corporations are again active in the international scene in view of an aging Japanese domestic market and an economy plagued in years of recession. In Q3, two sizeable overseas acquisitions by Japanese firms include Suntory Holdings’ USD3.82Bn deal for Orangina Schweppes of France and Dainippon Sumtomo Phrma’s USD2.55Bn deal for Sepracor of US.

The market seems to be giving these acquisitions a vote of confidence as Nomura’s recent share offer is over-subscribed by 10 times in its overseas offering and 3 times in the domestic tranche. Nomura expects to raise USD4.8Bn to fuel its global expansion as well as to upgrade its information technology platform to enhance its domestic branch network. The fund raised will also boost its capital ratio in anticipation of future tighter regulatory requirements.