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Bloomberg: Japanese Companies Aren't Active Enough In Global M&A Deals

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Bloomberg: Japanese Companies Aren't Active Enough In Global M&A Deals

Japan-based SoftBank Group Corp (OTC: SFTBF) (OTC: SFTBY)'s $32 billion takeover of U.K.-based ARM Holdings plc (ADR) (NASDAQ: ARMH) should be a common occurrence, according to Bloomberg's Tim Culpan.

Japanese companies are sitting on plenty of cash, and its national currency, the yen, is trading near historical all time-highs. As such, Japanese companies should be more active in large-scale, global M&A deals. Sony Corp (ADR) (NYSE: SNE) alone is sitting on $8 billion in cash and boasts an impressive debt-to-equity ratio of just 30 percent.

Panasonic Corporation (ADR) (OTC: PCRFY) is holding $9 billion in cash, FUJIFLIM Holdings Corp. (ADR) (OTC: FUJIY) has $5.3 billion and Canon Inc (ADR) (NYSE: CAJ) is sitting on $5.2 billion. Even Nintendo Co., Ltd (ADR) (OTC: NTDOY) has $5.1 billion sitting in the bank.

Related Link: The Story Behind SoftBank's Acquisition Of Arm Holdings: From A Turkish Resort Town To Secret Meetings In London

Take A Page Out Of China's Playbook

Chinese companies were aggressively targeting chipmakers, including Western Digital Corp (NASDAQ: WDC) and Fairchild Semiconductor Intl Inc (NASDAQ: FCS), but faced regulatory scrutiny. Japanese companies, on the other hand, could emulate similar deals and not be bound by the same scrutiny of Chinese companies.

Western Digital would be a good fit for Fujifilm, Panasonic or Hitachi, Ltd. (ADR) (OTC: HTHIY). Synaptics, Incorporated (NASDAQ: SYNA)'s business could generate synergies if combined with Sony's PlayStation unit.

Opera's "slimmed-down" browser in smartphones could have been a perfect fit for Nintendo.

Bottom line, investors "should be surprised that more acquisitions aren't being made," rather than being surprised by SoftBank's move on ARM Holdings.

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Posted-In: Bloomberg Global M&A Japanese Yen Tim Culpan yenM&A Global Media Best of Benzinga

 

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