Orix and Credit Saison in $106 billionmerger talks
TOKYO (Reuters) –
Orix Corp (8591.T), Japan’s largest
leasing company, and consumer credit firm Credit Saison
(8253.T) are in merger talks, financial sources close to the
matter said on Tuesday, seeking a deal to form a $106 billion
Orix has sounded out Mizuho Financial Group (8411.T),
Credit Saison’s top shareholder, about selling its stake to
allow the merger to happen, the sources told Reuters.
The merger would come as Japan’s financial sector suffers
from the fallout of the subprime loan crisis and a slowing
The consumer finance industry in which Credit Saison
operates has also been hurt by tighter regulation lowering
maximum interest rates, and legal rulings that have forced
firms to repay previous charges now deemed illegally high.
Both companies issued statements saying nothing had been
decided, after the Nikkei business daily reported they were in
talks to create a non-bank financial group with assets of 11.5
trillion yen ($106 billion).
Citing sources close to the talks, the Nikkei said that
setting up a holding company and placing the two companies
under it was an option, but the most likely outcome would be a
merger to be completed in the autumn of 2009.
The companies are working towards striking a basic
agreement next month to create Japan’s first major non-bank
financial group, the newspaper said.
The Tokyo Stock Exchange suspended trade in the two
In New York, Orix depositary receipts (IX.N) fell 2.8
percent, outperforming a 5 percent fall by the stock in Tokyo
on Monday and taking their losses to around 30 percent from
their 2008 high struck early in June.
Credit Saison shares have also struggled, falling 8 percent
in the past two trading days and down 35 percent from their
peak for the year in early February.
(Writing by Aiko Hayashi; Editing by Chris Gallagher)
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