Japan M&A Forum 2020
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In 2019, the Japanese M&A market bucked global trends as deal value surged to a seven-year high of USD75.4 billion. Increased levels of outbound buying are set to continue in 2020 as Japanese corporates continue to look abroad for growth. Domestic inbound M&A has also been on the rise due to a corporate governance overhaul, with investments rising to USD12.4 billion from USD6.6 billion in 2018. Our panel of leading M&A experts will discuss the current trends and deal flow activity of cross-border transactions into and out of Japan, and analyse where the best opportunities for investment lie in the year ahead.
The US continues to be the biggest geographic target for many Japanese corporates looking offshore for deals, with Japanese investment into the US being valued at USD42.9 billion across 83 deals in 2019. As the biggest dealmaking force in Asia last year, due to reduced competition in the face of US–China tensions, the opportunities are ripe for the picking. Our panellists will discuss the offshore investment environment and whether this deal-making trend is set to continue into 2021.
Corporate governance reforms have been driving domestic M&A activity in Japan for the past few years, as activist shareholders increasingly put pressure on corporations to spend money more efficiently. More recently, Japan has also seen a rise in the number of hostile takeovers, with traditional companies pursuing unsolicited bids to maximise corporate value. As activists continue to be more emboldened, it is becoming increasingly apparent that Japanese companies can no longer ignore these voices for change. Our panel of advisors will discuss how to best manage shareholder demands and expectations in the region.
Effective post-merger integration (PMI) is crucial to the success of transaction. For many Japanese acquirers that have closed acquisitions in outbound M&A transactions, PMI can be challenging from both an operational and cultural standpoint. This in-depth presentation will cover the necessary steps needed to navigate the PMI process and fully realise synergies, as well as a case study of a corporate that has successfully achieved PMI.
As Japanese corporates continue to look outbound for opportunities, Southeast Asia has become an increasingly attractive investment destination for dealmakers. Japan comprises nearly 20% of the region’s inbound investments, with Japanese corporates investing in a diverse set of sectors, ranging from financial services to technology. In India alone, Japan is the third-largest investor in the country. However, investing in this region comes with its own set of unique regulatory, geopolitical, and cultural challenges. Our panel of leading advisors share their views on how best to capture opportunities in the region.
Technology M&A is on the rise in Japan. As Japanese corporates feel the pressure from their shareholders to streamline their businesses and fuel growth, there is an increasing trend of selling non-core businesses and acquiring new technologies. Corporate venture capital investment into startups have surged in the past few years, and with the advent of full-scale 5G services and the growth of sub-sectors such as fintech, this trend is only set to accelerate. Our panel of corporate executives discuss dealmaking in this sector, and how companies can future-proof their positions by pursuing technology M&A.
The outlook for the Japanese private equity market remains prosperous. In 2019, buyout activity surged 5.4 times in value compared to 2018, and exit activity more than doubled. Investor appetite for large-cap Japanese deals and corporate carveouts continues to grow in the region, with global private equity firms actively looking for opportunities in Japan. That said, as the market heats up and valuations increase, there is increased competition among private firms and strategic investors in an increasingly saturated investor landscape. Our panel of private equity experts will discuss how best to capture opportunities in this environment.