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Japan firms set record in foreign M&A

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The Asahi Shimbun reports that Japanese companies merged or acquired a record number of foreign companies in 2011 so far. Most of these transactions involved Chinese companies, and South Korean and Thai companies were also high in number. The value of all the transactions combined was almost 3 trillion yen. The article states that “Japanese companies had 211 trillion yen in cash and deposits as of the end of March, the largest amount since the Bank of Japan began compiling statistics in 1979.”

Part of what is fueling this expansion overseas is the current strength of the yen. The Asahi article also suggests that this is a strategy to diversify investments as a protection against possible electricity shortages in the Tokyo area and northern Japan.

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