Japan shopping for acquisitions

FIRMS TAKE ADVANTAGE OF DEBT CRISIS PLAGUING WESTERN ECONOMIES

Tokyo (AFP) Japan Inc is on an acquisitions march across Asia and around the world, new f igures show, as f irms armed with ever more valuable yen take strategic advantage of the currency’s post-war highs. Western economies have been left in turmoil by the global f inancial crisis and Eurozone sovereign debt woes.

And in recent years Japan’s economy has been eclipsed by that of China, which has overtaken its neighbour to t ake second place in global GDP rankings on the back of rampant growth that has underpinned much of the global economy.

But last year Japanese f irms made 198 corporate purchases across the rest of Asia, mergers and acquisitions researchers Recof Data found, an all-time high and well above the previ- ous record of 153 in 2005. Worldwide the number of deals reached 455, only just short of the record of 463 in 1990, the peak of Japan’s last global spending spree, when it bought up iconic firms and properties, especially in the United States.

By value, the 2011 total came to 6. 3 trillion yen (Dh300 billion), up 67 per cent on the previous year and the third-highest f igure since the Recof survey started in 1985. With their home market ageing rapidly and expected to decline i n t he f uture, Japanese f i r ms fa ce deep- rooted challenges and have little choice but to look abroad for growth, both in markets and production, analysts say.

Prime Minister Yoshihiko Noda has encouraged the trend.

“We will take advantage of the merits of the appre- ciating yen to support Japanese companies in purchasing foreign companies and acquiring resource interests,” he said in September.

Ta ke d a P h a r maceut i - cal’s $14 billion takeover of Swiss drug giant Nycomed was Japan’s biggest deal in 2011, and beverage group Kiri n Holdings bought most of Brazilian beer and soft drink maker Schincariol for $2.6 billion.