Japan’s M&A market is poised to remain strong into 2026, driven by larger deal sizes and innovative private-finance structures, according to David Dubner, COO of Global M&A and Head of M&A Structuring at Goldman Sachs.
As Japanese corporates streamline portfolios and pursue growth investments, dealmakers are increasingly tapping private capital — combining equity, debt, and private credit from long-term investors such as insurers — to get transactions over the line.
These “high-grade” financing structures allow investment-grade companies to preserve their credit ratings, significantly lowering funding costs while enabling larger, more strategic acquisitions.
🔹 Why This Matters
- Japan M&A deal value reached $315B in 2025, the second-highest level in 25 years (LSEG)
- Private-capital-backed structures are expanding buyout capacity without straining balance sheets
- Targets once seen as “out of reach” are now viable
A recent example is the $7.4B Air Lease Corp buyout, where Sumitomo Corp and SMBC Aviation Capital partnered with Apollo and Brookfield, with Goldman as adviser.
🔹 Bigger Deals Ahead
Japan’s blue-chip firms still hold sizable non-core assets and trade at conglomerate discounts, while pressure from regulators, the Tokyo Stock Exchange, and activist investors is mounting.
Dubner expects spin-offs and transformational M&A to accelerate, supported by lower interest rates and abundant global capital.
“Japanese companies want to invest in innovation and growth — without overstraining their balance sheets.”