DealZone

Japan lessor mulls M&A nuptials

August 5, 2008

tokyo-skyline-2.jpgWith Japan’s financial sector facing tighter regulations in consumer lending and the grinding global credit crunch and slow economic growth stifling the leasing industry, what better time for two big companies in these industries to get hitched? Orix, Japan’s largest leasing company, and credit card firm Credit Saison are said to be considering a merger that would create a finance group with $106 billion in assets. Credit Saison’s stock surged 11.2 percent on the news, while Orix’s rose 2.6 percent. Japanese consumer finance is a legal and regulatory battlefield that General Electric and Citigroup both recently fled. “We may not just be talking about these two companies. We could see a flurry of consolidation after this,” said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management.

The air over Beijing may not be clean enough for long-distance runs in the park but foreign investors are enjoying some clear air with details on the country’s landmark anti-monopoly law, specifying turnover thresholds that will trigger a government review of proposed mergers. All business combinations must be cleared by the Ministry of Commerce if the joint global revenue of the companies involved exceeds 10 billion yuan ($1.46 billion) or 2 billion yuan in China, the People’s Daily reported on Tuesday. Even then, a review would not be needed unless two or more of the firms each had more than 400 million yuan of revenue in China during the previous accounting year, the paper said.

Other deals of the day:

* Swiss Re, the world’s largest reinsurer, has agreed to buy Barclays‘ life assurance portfolio for 753 million pounds ($1.48 billion) in cash, even as it wrote down more credit assets.

* Private equity group TPG plans to study Asciano‘s full-year results before deciding what to do about its A$2.9 billion ($2.7 billion) takeover approach, which the Australian port and rail operator has rebuffed.

* Japanese drug maker Daiichi Sankyo will launch an open offer to buy a further 20 percent in India’s Ranbaxy Laboratories on Aug 16, the Indian firm said.

* Scottish drinks maker AG Barr said it had agreed to buy exotic juice firm Groupe Rubicon Limited for 59.8 million pounds ($118 million) in cash in a deal to expand into the growing juice market.

* French market data group Ipsos said it has obtained an option from WPP to buy the TV audience measurement assets in the European Union owned by Taylor Nelson Sofres if WPP’s bid for the company is successful.

* Ping An Insurance plans to buy up to 10 percent of pharmaceutical firm Yunnan Baiyao in a deal that could be worth about $260 million at current market values.

* The Panzhihua steel group, one of western China’s top steel makers, will not change its previously announced merger plan, the group’s three listed units said after negative rumors about the plan caused their shares to plunge.

* A Lockheed Martin subsidiary plans to acquire Tenix Group‘s interest in RLM Holdings, a radar, systems engineering and integration and logistics management business, LocKheed said in a statement.

* Newmont Mining said it was considering strategic options, including a sale, for its 50 percent stake in Kalgoorlie Consolidated Gold Mines, one of Australia’s largest gold mines.

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