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No. 362, November 1999

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Japanese Companies in the US


SUMITOMO LIFE INSURANCE CO.'s strategy to get the asset-management expertise to succeed in the pension and mutual fund management fields at home includes buying into foreign investment-man-agement "boutiques." Last spring, it acquired what became FARRELL-SL INVESTMENT MANAGEMENT, INC. (see Japan-U.S. Business Report No. 355, April 1999, p. 6). Now, Sumitomo Life has bought a 20 percent stake in SPRINGFIELD & CO., L.L.C. The Chicago firm, which managed assets $1.5 billion worth as of September 1999, exposes the big life insurer to a different set of investment skills: global fixed-income arbitrage.

Broker/investment banker NOMURA SECURITIES CO., LTD. has had its ups and downs in the United States recently. After pulling back from or out of certain activities, its NOMURA SECURITIES INTERNA-TIONAL, INC. unit has moved into the North American private equity market. Following the lead of its London sibling, Nomura Securities International's Manhattan unit formed the Principal Capital Group, also based in New York City. Its mandate is to acquire mature companies in the basic services field that are low technology but asset-intensive. The target purchase price is between $1 billion and $3 billion. The group is selling itself as offering interested sellers quick finalization of the deal and the ability to commit large sums of capital. Since 1994, the London Principal Capital Group has acquired 11 businesses with a total value of $11.7 billion.

The Bellevue, Washington subsidiary of TRANS COSMOS INC. has emerged as a major source of funding for Internet-based start-ups in the United States, particularly those that want to extend their operations to Japan. It now has more money to expand its investment portfolio, having raised $100 million through a second round of private equity financing.

An exchange rate of ¥106=$1.00 was used in this report. aaaaa

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