LRG Capital Group, a global merchant bank that manages the BayStar Capital Investment Funds, has entered into a strategic partnership with the Arque Orion Group, which operates a growing w
LRG Capital Group, a global merchant bank that manages the BayStar Capital Investment Funds, has entered into a strategic partnership with the Arque Orion Group, which operates a growing wealth management and securities brokerage, Avalon Shonan Securities Co, Ltd, in Tokyo, Japan.
The partnership will allow the Arque Orion Group to tap and offer LRG Capital’s proven investment management talent, unique corporate advisory strengths, and institutional connections worldwide to benefit Japanese families of wealth who often control major corporate and family funds. The opportunity should also allow LRG Capital to proactively work with the Arque Orion Group to identify access and help their investors access attractive Japanese investments.
With more private equity wealth chasing fewer attractive deals in the US, LRG Capital has already expanded globally to uncover comparatively more attractive investments for its opportunistically driven BayStar Investment Funds. Today, according to data compiled by Bloomberg, 22 per cent of the 1,729 companies in Japan’s TOPIX Index trade at less than book value, while only 1.4 per cent of companies in the Russell 1000 Index of US stocks sell for less than book.
‘While Japanese investments might seem attractive from a comparative valuation point of view, western private equity groups are just beginning to feel their way around Japan’s uniquely different corporate and investor cultures,’ says Lawrence ‘Larry’ Goldfarb, CEO of LRG Capital. ‘We believe that a partnership with a local securities firm who not only understands Wall Street values and culture, but is itself the investment manager of a US private equity group, could help provide LRG Capital with the sensitivity and edge we need to compete more effectively in Japan.’
To date, the BayStar Capital Funds have invested in excess of USD1.5 billion of equity in over 250 companies. LRG Capital also currently represents private and public growth companies in such sectors as technology, life sciences, media, and communications. Members of LRG’s Corporate Advisory Services team have provided advisory services on over 300 transactions, with transaction values that total over USD75 billion.
‘Japanese investors are slowly re-establishing their debut back onto the world stage, such as the recent USD900 million bid for the high-end New York department store, Barneys,’ states Michael Ning, the 48-year-old Arque Orion Group leader, a naturalized US citizen, born and raised in Japan, and a UCLA graduate. ‘We believe that a strategic partnership with LRG Capital will give our Japanese investors access to the most competitive US and other Western investments, as well as competitively priced US-style mergers and acquisitions, and other corporate advisory services normally not accessible through even the largest banks and brokerages in Japan. We are also encouraged by LRG Capital’s interest and willingness to finance our future Japanese broker/dealer acquisitions.’