Japan's Daiwa targets 50% jump in M&A advisory with US focus

TOKYO: Japan's Daiwa Securities Group aims to boost annual revenue from the M&A advisory business by 50 per cent in eight years by hiring more bankers and acquiring boutique firms to try to expand its presence in the United States.

The second-largest Japanese brokerage and investment bank is targeting global M&A (merger-and-acquisition) revenue of at least ¥70 billion (US$518.33 million) in the year ending March 2031, compared to ¥46.7 billion for the financial year just ended, it said on Wednesday (May 31).

"The M&A business is where we can expect big growth without using much of our assets," Chief Executive Seiji Nakata told a strategy briefing on Wednesday.

"We plan to allocate our resources vigorously to expand mainly in the United States, potentially buying boutique M&A firms," he said, citing infrastructure, industrials, consumers and healthcare as sectors of focus.

Daiwa said it expected to increase the number of M&A bankers it employs over the next eight years to 900 from 650.

Its focus has been on M&A advisory for mid-cap deals worth between ¥50 billion and ¥100 billion, a segment relatively sheltered from inflation-driven market turbulence.

Among Japanese firms, Mizuho Financial Group said this month it would buy US M&A advisory firm Greenhill & Co for US$550 million, including debt, as it pursues a bigger share of the world's largest investment-banking fee pool.