Goldman Sachs is adding to its diverse and growing portfolio of Japanese investments, following its announcement on Thursday that it would pay Y25bn ($211m) for an 18 per cent stake in Usen, a Japanese cable music broadcaster and broadband group, the FT reports.
Goldman will have one director on the Usen board, and said it was investing in the company because of its strong management and growth potential. Usen, which has about 80 per cent of Japan’s cable music broadcasting market, also sells karaoke equipment and has a broadband fibre-to-the-home business.
Goldman said such investments bring opportunities for financial advisory work as well as financing, but that its strategy was to identify opportunities for enhancing corporate value by providing management advice. The group has an investment timeframe of three to five years but could hold its stake for as long as 10 years, it said. The strategy has so far been extremely profitable for the US investment bank, although it has held on to most of its investments.
Goldman’s principal investments in Japan already include major stakes in Sumitomo Mitsui Financial Group, Sanyo, Universal Studios Japan as well as golf courses and commercial property. Goldman has a 45 per cent stake in Fujita, the construction group, as well as additional preference shares, a 41.5 per cent stake in Universal Studios Japan, and a 30 per cent stake in Sanyo. One of its more interesting investments is Aruze, a maker of pachinko machines, which is similar to pinball and hugely popular in Japan.
Besides investing in companies, Goldman has been a major investor in golf courses, real estate and hotels in Japan. Its golf courses were listed as Accordia, in which it still holds a 45 per cent stake, while its hotel assets were put into a real estate investment trust, which was listed.
Goldmans will soon sell its 33 per cent stake in Sanyo Electric Credit to GE Commercial Finance, which launched a tender offer for the credit company. Goldman acquired the shares for about Y2,000 each and will be tendering them at Y3,250 a share.
Goldman acquired stock in Sanyo about a year ago for Y70 a share. The shares closed yesterday at Y200.
