U.S. investment fund Bain Capital will invest a total of ¥5 trillion in Japan over the next five years, a senior official said in a recent interview.
Japan has many "highly segmented" industries, said Masashi Suekane, partner at Bain Capital, forecasting that realignment and consolidation activities will intensity in the automobile parts and basic materials industries.
On the environment surrounding Japanese companies, Suekane said, "Shareholders and corporate managers are becoming more sensitive to capital efficiency."
He expects that realignment moves to enhance competitiveness will happen across automakers' groups of affiliates and partner suppliers.
With the basic materials industry facing a stronger need for massive capital investment, Suekane said that "leaders in niche markets will not be able to withstand global competition," underlining the importance of expanding their business sizes.
Bain Capital plans to increase its workforce in Japan. It has established a special team to help Japanese companies make effective use of their real estate with low profitability.
In addition, Bain Capital hopes to invest in new drug development projects by Japanese companies in cooperation with investment funds it operates in the United States.
Bain Capital led a consortium that acquired Japanese semiconductor maker Kioxia Holdings for some ¥2 trillion in 2018. Kioxia, previously called Toshiba Memory, is expected to go public by year-end following a chip market recovery.
While declining to say when Kioxia will be listed, Suekane stated that its business performance "is getting very good."
Last year, the U.S. fund spent ¥400 billion to buy Evident, to which Olympus transferred its founding business — scientific operations including microscope production.
Evident and Proterial, formerly Hitachi Metals, which Bain Capital acquired from Hitachi, are also expected to go public, Suekane said.
With your current subscription plan you can comment on stories. However, before writing your first comment, please create a display name in the Profile section of your subscriber account page.