💰 Capital cocktail fuels M&A in 2026: Goldman Sachs expects Japan’s M&A momentum to remain strong in 2026 as new structures blend equity, bank loans, and private credit. Insurers play a central role as long-term capital providers.
🧹 Exit over survival: Takeovers and management buyouts are driving delistings to record levels. Added pressure comes from the TSE’s capital-efficiency push, nudging weaker firms toward a sale rather than a long grind.
🏗️ Bigger deals, no balance-sheet hangover: “High-grade” financing aims to preserve investment-grade ratings and lower funding costs. What used to be “too big” is now doable, especially in data centers and AI infrastructure.
📉 Stock market on a diet: The number of companies listed on the Tokyo Stock Exchange is expected to fall by 58 to 3,778 in 2025. After years of growth since the TSE–Osaka merger in 2013, this marks a clear reversal.
🔄 Prime, but too small: Around 70% of companies in the TSE Prime segment sit below a USD 2 billion market cap. Unattractive for many global funds, making a sale or MBO the more rational exit.
Background
Japan’s market is clearing out micro-listings while M&A replaces IPOs as the main path to renewal and growth. Private capital increasingly fills the role once played by public markets. Tokyo becomes more investable for global investors, and far less comfortable for small caps.
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