Japan is entering the era of "big inheritance", with over 600000 profitable small and medium-sized enterprises facing a succession gap. At the same time, the reform of the Tokyo Stock Exchange has pushed many companies to spin off non core businesses, and the depreciation of the yen has given overseas buyers unprecedented valuation advantages.

The report proposes five core elements for the success of cross-border mergers and acquisitions: firstly, cultural due diligence. Japanese sellers value employee retention and brand inheritance more than the highest price; The second is regulatory navigation, and the application for FEFTA is an essential step. The review of core areas needs to be planned in advance; The third is accurate valuation, which requires attention to hidden liabilities such as unpaid overtime wages, land pollution, etc; The fourth is a slow paced PMI to avoid talent loss; The fifth is long-term relationship investment, rather than short-term trading arbitrage.