China boosting investment in Japan, holds shares worth Y1.5 tril

Saturday 08th January, 06:26 AM JST

TOKYO —

Two investment funds backed by the Chinese government are accelerating their purchases of stakes in major Japanese listed firms, with their total market value surging 10-fold to 1.5 trillion yen in less than two years, a recent study showed.

The two funds were major shareholders of a combined 86 firms listed on the Tokyo Stock Exchange’s First Section as of last September, compared with 35 firms as of March 2010 and 13 firms as of March 2009, according to the study by Chibagin Asset Management Co based in Tokyo.

Their combined market capitalization last September came to 1,515.7 billion yen, in stark contrast to 624.2 billion yen as of March 2010 and 155.6 billion yen as of March 2009.

Chibagin Asset Management predicts the value could reach 3 trillion yen by the end of March 2011.

‘‘I assume the funds are buying Japanese stocks considering them low-risk assets in managing an increasing amount of foreign currencies,’’ Fujio Ando, an adviser at the asset management firm, said.

‘‘I doubt they will move to launch an aggressive bid to obtain controlling stakes (in Japanese firms) anytime soon, but I don’t know the future,’’ he said.

The funds, which are both based in Australia, have made a series of investments in Japanese companies in various sectors including finance, electronics, telecommunications, trading houses, and utilities, according to the study on the financial reports of 550 major listed firms.

As of last September, one or other of the funds was the third-largest shareholder in such big Japanese firms as Mizuho Financial Group Inc and NEC Corp, the fourth-largest in Nomura Holdings Inc, and the fifth-largest in Takeda Pharmaceutical Co.