M&A Activities in Japan fall to 9Yr Low

Japanese companies made the fewest acquisitions in a decade during the first half as the yen’s volatility climbed to a four-year high, cooling buying interest.

The number of deals announced in the first half of 2013 was 997, with a total value of $45.7 billion, according to data compiled by Bloomberg. That’s the lowest number of deals and value since the first six months of 2004. Total deal value is 47 percent lower from the first half of 2012.

Since Prime Minister Shinzo Abe swept into power in December on promises to resurrect the economy by expanding stimulus measures and weakening the yen, the Japanese currency has whipsawed between 82.36 yen and 103.21 yen to the dollar. The yen’s 100-day volatility rose to 14.81 points in July, the highest since August 2009, and more than double the 6.97 figure at the start of the year.

“Companies had set their budgets for the year as of April-May under certain assumptions, but they’re not sure they will hold,” said Nobuhisa Ishizuka, a Tokyo-based partner specializing in mergers at Skadden, Arps, Slate, Meagher & Flom LLP. “This makes it difficult for a lot of them to pull the trigger.”

Bloomberg

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Mingze Wu

Mingze Wu

Currency Analyst at Market Pulse
Based in Singapore, Mingze Wu focuses on trading strategies and technical and fundamental analysis of major currency pairs. He has extensive trading experience across different asset classes and is well-versed in global market fundamentals. In addition to contributing articles to MarketPulseFX, Mingze

centers on forex and macro-economic trends impacting the Asia Pacific region.
Mingze Wu