Nippon Paint Holdings Co. will seek acquisitions overseas and finance the deals by borrowing in Japan where interest rates are low, the co-president of the company said.
(Bloomberg) — Nippon Paint Holdings Co. will seek acquisitions overseas and finance the deals by borrowing in Japan where interest rates are low, the co-president of the company said.
Borrowing costs are likely to remain low even if the Bank of Japan’s new governor Kazuo Ueda moves to end the central bank’s ultra-loose monetary policy, Nippon Paint’s Yuichiro Wakatsuki said in an interview.
Wakatsuki, a banker, advised Singapore’s mogul Goh Cheng Liang’s Wuthelam Holding Pte. in 2021 when the holding company took a majority stake in Nippon Paint in a $12 billion deal, and later joined the paint maker. Nippon Paint has been on a four-year ¥700 billion-plus ($5.2 billion) push to buy assets overseas and seek growth abroad.
Read more: Nippon Paint, Wuthelam Join in $12 Billion Cross-Asia Deal
“Even if long-term interest rates go up in Japan in the future, it will probably be in the range of 2% to 3%,” said Wakatsuki, who became co-president two years ago. “That’s still much cheaper than borrowing in US dollars.”
Nippon Paint’s balance sheet showed ¥1.29 trillion in total liabilities at the end of December. Wakatsuki declined to comment whether he has any acquisitions currently in works.
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