KKR: Japan ‘fertile territory’ for private equity April 27, 2007Posted by fukumimi in Economy & Business, Japan.
The FT article.
I wholeheartedly agree that Japan will be ripe with opportunities for private equity players. There are lots of PE firms expanding their presence in Japan as we speak.
Whilst traditional business interests seem to have been successful in manipulating the media to sensationalize the activities of PE funds and tarred them all with the same brush as money obsessed vultures willing to do anything to make a quick buck, I personally think that PE firms can be a force for good in the current Japanese business climate, and it may be necessary for outside influence to kick start the process of introducing change into the system. It would seem much easier for foreign firms with no ties or associations to attempt audacious deals than for natives.
That is not to say that I am a fan of the overly aggressive and/or short-sighted practices employed by some firms/funds, but maybe having such players in the game is a price the local business ecosystem has to pay to allow firms with more balanced strategies to operate.
I hope PE firms become an agent for change for the better in Japan, there are lots of companies and departments within companies with substantial unrealized value, and if the potential can be unlocked, it will strengthen the Japanese economy as a whole.
I hope the PE firms learn from the mistakes made by their VC cousins who attempted to break into Japan and then retreated back in the early 2000s. The biggest challenge may be to find the right resources to staff their local offices.