Mizuho Securities is looking to capitalise on inbound investment into Japan to generate revenue as the attractiveness and growth prospects of Japanese investments rise, the chief executive of the securities arm of Mizuho Financial Group said.
There are opportunities in growth areas such as data centres as well as the strategic sectors promoted by Prime Minister Takaichi, which include AI, chips and defence, Yoshiro Hamamoto said in an interview with Reuters.
While Japanese firms have long exported capital abroad in the face of sluggish domestic growth, the return of inflation has prompted a surge in growth investments at home, while higher interest rates and growth opportunities in areas such as data centres and logistics are making Japanese assets more attractive.
“When people think of Japanese M&A the focus is almost always on outbound investment, but attracting investment into Japan from U.S. and European companies will be extremely important. Of the two, that will be our focus going forward,” Yamamoto said.
Japan is among the hottest markets for global private capital, experiencing a wave of private equity-led M&A and real estate deals in recent years. Earlier this month, U.S.-based Ares Management said it raised $4 billion for a real estate investment fund.
“Brokering Japanese equities is our bread and butter, but the big steak would be things like finding land for semiconductor factories, arranging and structuring financing,” Yamamoto said.
The world’s largest contract chipmaker, Taiwan’s TSMC, has invested in multiple fabs in southern Japan.
To capitalise on such opportunities in the future, Mizuho is expanding its investment banking workforce globally to increase the number of sector bankers who engage with clients from the early stages of corporate strategy to originate deals.
In 2023, it bought U.S. M&A advisory firm Greenhill to bolster its global investment banking presence.
“If we don’t strengthen our upstream capabilities, we won’t be able to originate the deals themselves,” Hamamoto said, declining to provide specific hiring targets.
In Japan, there is a shortage of advisory talent and Mizuho needs to hire dozens more people, primarily junior bankers, Hamamoto said.
Reuters
