Japanese investment banks lose out to global players in M&A spree

US heavyweights may be in a stronger position to advise on foreign targets.

Bloomberg reports that foreign investment banks are edging out homegrown players in Japan's record acquisition spree.

Foreign firms occupied the first three places in Japan's merger advisory rankings in 2018 to handle $403b (JPY44.6t) of deals, data from Bloomberg show, with Goldman Sachs leading the way followed by Morgan Stanley whilst JPMorgan Chase & Co rounds out the top three.

On the other hand, Japan's largest investment bank, Nomura Holdings Inc., fell out of the top three for the first time since 2016.

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Japanese bankers are falling behind partly because a significant share of deals involve foreign targets where they are in a less stronger position to provide advice, Tomonori Ito, a professor at Hitotsubashi University told Bloomberg.

In 2018, there were a record 3,400 mergers and acquisitions involving Japanese companies to a total deal value of $309.4b (JPY34.3t), according to data compiled by Bloomberg. 

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Photo from Lombroso - Own work, CC BY 2.5