Funds Earmark 4 Tril. Yen to Invest in Japan Firms in 2007: Daily

By Kyodo News International, Tokyo

Jan. 3–TOKYO — Corporate buyout funds are setting aside nearly 4.07 trillion yen ($34.27 billion) to invest in Japanese companies in 2007, a sharp 240 percent increase from two years earlier, the Nihon Keizai Shimbun newspaper reported Wednesday.

Expecting more industry consolidation to occur in Japan, many European and U.S. funds are heading to the country’s shores, the business daily said, citing its own survey.

Acquisition funds, which usually collect money from investors and borrow some three to five times that amount from financial institutions, may spend more than 20 trillion yen this year, according to the paper.

It also said investment funds potentially have more purchasing power than Japanese firms, which spent about 15 trillion yen in 2006 on corporate mergers and acquisitions.

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Copyright (c) 2007, Kyodo News International, Tokyo

Distributed by McClatchy-Tribune Business News.

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