ValueAct loses its temper in 7-Eleven 10 May 2023 Boss Mason Morfit prefers to chide undervalued conglomerates behind closed doors. But Seven & i has so provoked him, his firm is publicly calling for chief Ryuichi Isaka’s head. ValueAct has a good case, so the looming showdown will test how rude activists can get in Japan.
Sumitomo triples down on Jefferies at right time 28 Apr 2023 The $8 bln Wall Street firm’s earnings have slumped with deal flow, so SMFG boss Jun Ohta can boost his stake to 15% at roughly the same price he paid two years ago. This time he has the benefit of knowing his partners better and can get ahead of any boom in investment banking.
MGM’s bet on Asia’s next Macau may age well 26 Apr 2023 The US casino operator will open Japan’s first casino. It isn’t an obvious destination for gambling: Sands and Wynn stayed away, preferring Singapore and the UAE. But the Osaka resort could be as big a money spinner for the operator as its properties in the Chinese hub.
Japanese online lender is curious beast 21 Apr 2023 Rakuten Bank shares jumped 33% in Tokyo’s largest IPO since 2018. Loans only account for a third of its balance sheet, the government is its biggest borrower and it buys lots of assets from its parent. The pop reflects a thin supply of tech-savvy finance listings.
“Super Mario” augurs more media-gaming tie-ups 20 Apr 2023 Nintendo and Universal’s film adaptation of the hit video game franchise could rake in $1.5 bln. That’s a big victory for an industry whose spinoffs have more often been the butt of jokes. With gaming stocks having sold off sharply, there’s logic in more media giants plugging in.
SoftBank exit eases Alibaba’s mega reboot 13 Apr 2023 The Japanese group is slashing its stake in the Chinese e-commerce firm to 4%, a symbolic end to a 23-year investment. Not much changes for Alibaba, but SoftBank’s position was a distraction. Now boss Daniel Zhang can focus on pitching shareholders on his radical breakup plan.
Perfection is enemy of $15 bln Toshiba buyout 24 Mar 2023 A group led by Japan Industrial Partners will offer less than two times what foreign activists paid per share to bail out the firm in 2017. It’s not the dream deal outsiders hoped for, but markets are uneasy and geopolitics fast-changing. If it goes through, it’ll be a win.
Credit Suisse reinforces Japan’s offshore anxiety 21 Mar 2023 Global bank jitters have investors looking for weak links. Japanese lenders, with staid depositor bases, are unlikely targets for bank runs, but they hold $2 trln of overseas bonds with thin profit margins. They may not dump US Treasuries in haste - but rebalance they will.
Bad news salvo gives Bank of Japan some cover 16 Mar 2023 The collapse of U.S. lender Silicon Valley Bank knocked down sovereign bond yields. Consumption remains soft, and while Japan Inc is hiking wages by 3% on average, that’s well below inflation. There’s nothing to cheer, but it takes pressure off the BOJ to adjust rates.
Seoul and Tokyo demonstrate chip war limits 16 Mar 2023 Japan may ease curbs put on high-tech materials exports to South Korea after a four-year diplomatic spat. The impact was minimal; companies like Samsung found easy workarounds. The United States and China face similar difficulties decoupling sophisticated supply chain links.
Kyocera chief’s China swipe is half-convincing 22 Feb 2023 Hideo Tanimoto, who leads the $19 bln Japanese chip supplier, said the country is not a “viable” export manufacturing base. That’s hyperbole, but a winnowing of foreign firms in China is likely. Politics is a factor, but financial and competitive realities are more important.
The big bet against Japan’s new central bank boss 16 Feb 2023 The world’s third largest economy picked Kazuo Ueda to be governor of the Bank of Japan. In this Viewsroom podcast, Breakingviews columnists discuss the challenges facing this outsider as international investors continue to bet against the BOJ keeping rates low.
Bank of Japan’s new governor starts on back foot 14 Feb 2023 Academic Kazuo Ueda will replace Haruhiko Kuroda atop the central bank after the first choice demurred. He’s respected but lacks factional support and faces an unpopular prime minister pushing an expensive agenda. His appointment augurs a rocky transition at a delicate time.
Japan’s next central bank chief may rue promotion 13 Feb 2023 Bank of Japan Governor Haruhiko Kuroda retires in April. His successor’s first task will be to tweak monetary policy without wrecking the $5 trln economy, upending markets or crippling the BOJ’s balance sheet. And that’s just the start of a long to-do list.
Japan activists seek smaller fish to fry 7 Feb 2023 With the Toshiba campaign stuck in the mud, some investors are eying easier prey. Elliott Management is angling for $6 bln Dai Nippon Printing; Oasis is after a $2 bln elevator maker. If these less ambitious campaigns don’t pay off, it’ll send gadflies back to the drawing board.
Rejigged Renault-Nissan alliance looks headless 30 Jan 2023 The French and Japanese automakers clinched a deal to save their 24-year partnership. Renault will only vote 15% of its stake in Nissan, which now has a similar say in its partner. It avoids a messy divorce, but the lack of a clear leader may make decision-making trickier.
Three carry trades for a new monetary policy era 27 Jan 2023 Central banks’ moves mean that investors borrowing money in yen and placing it in U.S. assets – a once-popular “carry trade” – are no longer onto a sure-fire winner. They can do better by shorting the euro and investing in Mexico, Brazil or Hungary.
Toshiba buyout heralds a big step back for Japan 20 Jan 2023 A deal for the $15 bln conglomerate is finally in sight. Foreign investors, who agitated for years, are likely to sell control back to local owners less inclined to shake up a national icon. Domestic policy shifts may also stifle local private equity before it can get rolling.
Bank of Japan has learnt danger of half-measures 18 Jan 2023 The central bank’s decision to stay put on interest rates saw the yen soften and hurt 10-year bond yields. Last month’s surprise tweak to bond trading bands failed to impress traders. Inaction may be painful and expensive, but muddled economic signals make it understandable.
Sumitomo Jefferies would be neat but no cigar 5 Jan 2023 Boss Jun Ohta wants to expand the Japanese bank’s pact with the Wall Street firm and boost its stake. That would add investment banking without much expense. Unlike the 37% of earnings MUFG logs from owning a fifth of Morgan Stanley, Jefferies is unlikely to make the same mark.