Japanese banks ‘less reluctant’ to finance hostile takeovers: report

Banks are seeing a rise of deals related to unsolicited bids for corporate takeovers.

Japanese banks have reportedly become less reluctant to finance hostile acquisitions on the back of governments new takeover guidelines that have shaken off taboo on such deals.

Speaking to Reuters, Akihiro Fukutome, head of the Japanese Bankers Association, said that local banks are now less worried about reputational risks.

“I believe new takeover guidelines from the industry ministry last year have helped lower psychological hurdles,” Fukutome said.

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Fukutome, who also heads the core banking arm of Sumitomo Mitsui Financial Group, said banks should consider unsolicited proposals if a deal would benefit the target company and help improve its long-term value.

"The atmosphere for unsolicited bids is changing, and we've seen a rise in such deals in our pipeline," he added.

The Ministry of Economy Trade and Industry (METI) last year released new M&A guidelines aimed at cracking down on excessive defense tactics, removing a long-held stigma around unsolicited bids and spurring corporate takeovers.

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