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Nomura Talking with KKR, TPG and Others About Selling More Assets: Report

Photo by Issei Kato, Reuters
Photo by Issei Kato, Reuters

(Reuters) – Japan’s Nomura Holdings has approached big private equity firms about the possible sale of domestic businesses including its real estate arm as the bank seeks to shore up its capital buffers, the Financial Times reported on Wednesday.

The bank is considering selling Nomura Real Estate and Nomura Research Institute, its consulting, information technology and research arm, the FT reported, citing several people familiar with the preliminary talks with parties including KKR and TPG.

“They are talking to everyone about everything not directly related to the securities business,” the Japan head of one big private equity firm that has taken part in the talks said but there was no formal auction process, the FT reported.

Buyout firms which have looked at Nomura Real Estate say Nomura may have difficulty in fetching a high price due to its debt load, according to the article.

The firm and one former executive say the equity may only be worth 100 billion yen while the debt is about 800 billion yen, the FT reported.

Nomura agreed to sell its stake in restaurant chain Skylark to U.S. private equity firm Bain Capital last month and it also agreed to sell ball bearing maker Tsubaki Nakashima Co. to The Carlyle Group for about $800 million earlier this year.

There is also talk that Nomura might put Ashikaga Bank, which a Nomura-led consortium acquired in 2008, on the block at some stage, the FT reported.

Nomura was not immediately reachable for comment.

Japan’s top brokerage posted a quarterly loss of 46.1 billion yen ($598 million) earlier this month — its first quarterly loss in 2-1/2 years — due to a slump in investment banking revenues. It subsequently tripled its cost-cutting target to $1.2 billion.

The debt crisis in Europe has ratcheted up pressure on Nomura to tap the brakes on a global expansion that started with its purchase of the Asian and European businesses of failed Wall Street bank Lehman Brothers in 2008.

($1 = 77.0600 Japanese yen)

(Reporting by Michelle Martin, editing by Bernard Orr)