Strong yen will encourage more overseas acquisitions

ON JAPAN

In recent months we have observed a notable rise in ambition among Japanese corporate leaders, particularly in relation to the pursuit of opportunities in other countries.

The earthquake appears to have brought to the fore the challenges of doing business in Japan, highlighting that domestic markets are often shrinking and companies must expand overseas to grow the top line. Furthermore, recent yen strength provides additional fire power for overseas deals. Foreign M&A activity has accelerated sharply – the value of outbound deals totaled $50.2bn during the first nine months of 2011, a 72% increase compared to the same period last year, with most activity occurring since the earthquake.  We have seen broadening of activity to include SMEs and more domest...