Japan is leading Asia’s mergers and acquisitions rebound in 2025, with $232 billion in deals involving Japanese companies in the first half of the year, according to LSEG data.
The total value of M&A activity in Asia reached $650 billion during the same period, more than double compared to a year ago.
Bankers say a mix of low interest rates, outbound investments, private equity activity, and management reforms is driving strong deal momentum. Japan’s government has been pushing companies to improve corporate governance and address low valuations, encouraging firms to privatize listed subsidiaries and divest non-core businesses.
Major deals in the first half included a $34.6 billion buyout by Toyota group companies and a $16.5 billion transaction by Nippon Telegraph and Telephone, both taking listed subsidiaries private. Other large moves include SoftBank Group’s participation in a $40 billion fundraising round for ChatGPT maker OpenAI.
Japanese companies are also looking abroad for growth as the domestic market shrinks. Firms such as Dai-ichi Life and Nomura Holdings announced major transactions in the first half, with bankers expecting continued activity across industries. Corporate carve-outs have become more common, with companies like Seven & I Holdings selling off superstores and other businesses to Bain Capital for about $5.5 billion.
Bankers say the pipeline for private equity-backed deals remains strong. Potential transactions expected in the second half include the acquisition of cybersecurity firm Trend Micro, which has a market value of 1.32 trillion yen.
Still, dealmaking faces challenges. Uncertainty in the global economy has created gaps in valuation expectations between buyers and sellers, leading to failed deals. Despite that, bankers say investment appetite in Japan remains high.
