A new era for Japanese M&As

Is METI's "M&A Code" a gamechanger?

It’s been two months since Alimentation Couche-Tard surprised many with its takeover bid for Seven & I Holdings. M&As are rare in Japan, and even rarer when the acquirer is non-Japanese. But those paying close attention might have foreseen something big was brewing.

On August 31, 2023, METI released a new set of M&A guidelines in a 72-page document (“The Guidelines for Corporate Takeovers”), aiming to foster a “healthily functioning fair M&A market” (in METI’s own words).

Most are familiar with Japan’s Corporate Governance Code. I like to think of this as METI’s equivalent “M&A Code,” which establishes a code of conduct for management and boards in handling M&As, particularly unsolicited bids.

What are the key messages? How are experts (Japanese M&A lawyers) interpreting them? And what are the implications for the Japanese market?