Mizuho will expand focus on M&A for smaller Japanese companies

MIZUHO Financial Group will expand its mergers and acquisitions (M&A) business for small and medium-sized Japanese companies that have traditionally been under served.

Mizuho Bank and Mizuho Securities will invest in Japan Blue M&A Advisory (JBMA), which was established by Nippon Management Systems to focus on the sector, according to sources familiar with the situation.

Japan’s ageing population has caused a shortage of successors for smaller businesses. More than 50 per cent of presidents of Japanese companies are older than 60, according to a 2022 survey by Teikoku Databank. The number of corporate bankruptcies due to succession difficulties exceeded 500 for the first time in 2023.

After the investment, JBMA is expected to be owned more than 50 per cent by Nippon Management Center, less than 40 per cent by Mizuho Bank, and 10 per cent by Mizuho Securities.

In Mizuho Financial Group, Mizuho Securities has been responsible for M&A between large companies while Mizuho Bank has been responsible for M&As of medium-sized companies with which it has relationships. However, the group was not fully equipped to handle the M&A needs of smaller companies, according to the sources, who asked not to be identified discussing internal matters.

A spokesperson for Mizuho Financial Group declined to comment. Nippon Management System did not respond to an e-mailed request for comment. BLOOMBERG