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Nomura Leads in Japanese M&A Deals, Surpassing $54 Billion in 2023

Nomura's Strategic Deal-making Secures Top Spot in Japanese M&A Sector Amid Rising Market Activity
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In a remarkable year for mergers and acquisitions, Nomura Securities emerged as the leading force in the Japanese market. The firm advised on or underwrote transactions totaling 8.04 trillion yen, approximately $54.1 billion, surpassing its closest competitor, Mitsubishi UFJ Morgan Stanley Securities, by a significant margin. This performance marks a notable shift from the previous year, where Mitsubishi led the sector.

Nomura’s success extended beyond the sheer value of the deals. The company also excelled in the number of transactions, a testament to its extensive corporate sales network. Japan’s M&A activity reached a five-year peak in 2023, with deals amounting to about 23 trillion yen or $155 billion. This surge reflects a 50% increase from the prior year, driven partly by the Tokyo Stock Exchange’s initiatives and a rise in activist investor activities.

Nomura, alongside Mizuho Securities and J.P. Morgan Japan, played pivotal roles in two major transactions exceeding 1 trillion yen each. These included the Toshiba buyout and Japan Investment Corp.’s acquisition of JSR. Interestingly, Japanese financial groups were absent in the high-profile Nippon Steel’s acquisition of U.S. Steel, with Citigroup Global Markets Japan and other international players advising.

The Japanese M&A landscape also featured numerous deals in the 200 billion to 400 billion yen range, with Nomura actively involved in many, such as advising Nippon Life Insurance’s acquisition of Nichii Holdings.

The market dynamics were also shaped by the Tokyo Stock Exchange’s market reform, which influenced many companies to consider privatization, according to Atsushi Tatsuguchi of Mitsubishi UFJ Morgan Stanley. Moreover, the guidelines released by the industry ministry on corporate takeovers have potentially set the stage for more acquisitions without prior consent.

While the value of Japan-related deals soared, the number of transactions remained steady, reflecting caution among small and midsize companies due to economic uncertainty. However, rising interest rates might not dampen the M&A market, as suggested by Akira Kiyota from Nomura, who anticipates increased participation due to potential profitability for lenders.

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