It has been a tough couple of years for M&A professionals in Japan. Times though are changing.
Many banks are now looking to expand their M&A teams, says Iwona Bancerek, a consultant at CDS Consulting.
“Although the market is still dominated by big players like Nomura, we are seeing a number of M&A advisory departments growing because the best bet for many Japanese firms in the current market is to either merge or restructure. The strong yen is also making cross-border M&A more appealing,” she adds.
Alexander De Giorgio, a consultant at Morgan McKinley Tokyo, says hiring levels within the M&A sector are “relatively healthy”. In particular, he thinks expectations over future growth in M&A activity are causing both foreign and local banks to increase sector coverage and restock severely depleted analyst pools.
“As a result, there is demand at both the senior level, where candidates with industry experience and contacts are in demand, and the junior level, where candidates with strong technical and valuation skill sets are being pursued,” adds De Giorgio.
Bancerek says the focus of much of the current M&A action is on small-scale deals involving small to medium Japanese firms, where banks typically compete for a slice of the pie with boutique advisory firms. And banks, which tend to prefer specialised staff in their M&A departments, may face a challenge if they want to woo talent away from their boutique rivals.
“Candidates from boutique firms are oftentimes more hands on, with experience in the entire M&A process, and probably enjoy more liberty and more interest-driven assignments. For banks to attract such professionals might be quite a challenge. The brand, promotion opportunities and compensation would be the key factors in getting them to change jobs,” explains Bancerek.
In terms of skill set, she says domestic banks and smaller Japanese platforms are keen on CPAs, CPTAs and candidates with a good grounding in finance combined with M&A experience.