Overview of Japanese M&A Volume 2

In the previous article, we explained that although the number and value of cross-border M&A  decreased, the number and value of M&A by Japanese companies in 2020 decreased only by 8.8% and 17.2% respectively, to 91.2% and 82.8% compared to the previous year. Let’s take a look at the major large-scale M&A by Japanese companies in FY2020.

1. Major M&A by Japanese companies in FY2020 (Resource:  RECOF research)

Ranking Size (JPY Million)    Parties (buyer / target company)  
※For simplicity, some company names are given as the names   of the parent company, etc.    
   MarketDate (2020)    
   1       4,200,000         NVIDIA / Arm (sold by Softbank)       Out-In   9/14    
   2       2,217,600         Seven & i / Speedway (American convenience store)       In-Out   8/3    
   3       1,285,139         Wuthelam (Singapore) / Nippon Paint       Out-In   8/21    
   4       299,816       Mitsubishi UFJ Lease & Hitachi Capital       In-In       9/25    
   5       242,000       Blackstone / Takeda Consumer Healthcare       Out-In   8/25    
   6       238,000       NEC / Avaloq (financial software company in Switzerland)   In-Out   10/5    
   7       214,861       Nitori / Shimachu       In-In       10/30    
   8       200,000       Toyota Motor / NTT (cross-shareholding)       In-In       3/24    
   9       132,471       JRF Investment Corporation / MMI Investment Corporation   In-In       8/29    
   10       132,267       SMFL Mirai Partners / Kenedix       In-In       11/24    
   11       122,200       Sony / Ellation Holdings (animation creator in USA)       In-Out   12/10    
   12       120,844       Mitsui Fudosan / Tokyo Dome       In-In       11/27    
   13       110,800       Ichigo Trust (Singapore) / Japan Display       Out-In   2/1    
   14       110,166       Nichii Gakkan MBO       Out-In   5/11    
   15       108,643       Arcland Sakamoto / LIXIL Viva       In-In       6/10    

Of the top 15 deals, seven were domestic In-In deals, five were cross-border Out-In deals (acquisition of a Japanese company by a foreign company), and three were In-Out deals (acquisition of a foreign company by a Japanese company).

It is noteworthy that except for the cross-shareholdings of Toyota Motor Corporation and NTT, which ranked 8th, the manufacturing deals (1st, 3rd, 5th and 13th) were all Out-In deals. In terms of timing, 11 deals were implemented in the second half of the year from July onward, suggesting that many deals scheduled for the first half of the year in particular had to be rescheduled for the second half of the year due to the effects of the Cov-19 infection.

2. Major Acquisition of Subsidiary Shares by Japanese Companies in FY2020

   Ranking       Size (JPY Million)       Parties (buyer / target company)    
   1       4,257,794       NTT / NTT DoCoMo    
   2       581,556       ITOCHU / FamilyMart    
   3       531,817       Hitachi / Hitachi High-Tech Corp    
   4       396,034       Sony / Sony Financial Holdings    

As there are negative effects of parent-subsidiary listings, 13 of the 57 TOB (tender offer for shares) cases filed were for the dissolution of parent-subsidiary listings, such as the four cases mentioned above; the total number of TOB cases increased by nine from 48 in 2019.

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