Daily Brief Japan: Bengo4.Com Inc, Digital Holdings Inc, Mandom Corp, Chugoku Electric Power Co, Toyota Motor, Japan Post Bank, Daido Steel, Nicca Chemical and more

• Back in mid-August, Bengo4.Com Inc (6027 JP) (“Bengoshi.com”) announced that it had applied to transfer to TSE Prime. 3+mos later, today it announced it will move on 4 Dec 2025.
• That sets up a TOPIX inclusion for end-January 2026 and then a likely upweight at end-April 2026.
• There is no accompanying offering, and the float is likely small. But the inclusion displaces the current active base. And there’s at least one large holder selling recently.

• SilverCape has increased its tender offer price for Digital Holdings Inc (2389 JP) by 2.9% to JPY2,450 and raised the minimum tendering condition to 6.8 million shares (36.61% ownership ratio).
• The SilverCape hostile offer faces twin challenges: preventing completion of the Hakuhodo Dy Holdings (2433 JP) offer and gaining the Board’s support/stopping the implementation of countermeasures.
• SilverCape’s revised terms are unlikely to address these challenges. While Hakuhodo may (again) revise its offer, I expect the bump to be marginal (less than 5%). 

• Today late in the afternoon session, the Nikkei reported that the MBO price would be bumped by “about 30%”. The stock popped 4.6%. 
• Post-Close, the deal is bumped from ¥1,960 to ¥2,520 (+29%). Activist holders Murakami Group with 21.4% and Hibiki Path Advisors with 5.5% have agreed to tender. 
• With the two main activists publicly engaged now agreed to tender, this looks like a done deal.

• Digital Holdings Inc (2389 JP) jumped today after spending a week or more at levels just above the revised Tender Price of Hakuhodo Dy Holdings (2433 JP). 
• SilverCape had promised to bid ¥2,380 against Hakuhodo’s ¥1,970 and the Company responded by threatening a Poison Pill against SilverCape, for relatively spurious reasons (as discussed here).
• Hakuhodo bid slightly more, and lowered its minimum, thereby nearly ensuring their success. HOWEVER…. SilverCape’s CIO interviewed yesterday promised a higher price. The stock popped today. But…

• Mandom Corp (4917 JP) has disclosed that the CVC-sponsored MBO price has increased by 28.6% from JPY1,960 to JPY2,520.
• The revised terms mark a big win for activists, Murakami and Hibiki. Both activists will tender, with Hibiki reinvesting around 40% of its proceeds into the offeror’s parent entity.
• The revised terms are attractive, and this is a done deal. The offer closes on 18 December, with payment from 25 December.

• JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.
• The annual index review takes place in August every year. We look at the latest rankings of potential ADDs/DELs every month.
• Below is a look at potential ADDs and DELs for the JPX-Nikkei 400 Rebalance to come in August 2026 based on trading data as of end-November 2025.

• Context: The Toyota Motor (7203 JP) vs. Suzuki Motor (7269 JP) price-ratio has deviated more than two standard deviations from its one-year average, presenting a potential relative value opportunity.
• Highlights: Going long Toyota and short Suzuki targets a 7% return.
• Why Read: Essential for quantitative traders seeking mean-reversion opportunities, with detailed execution framework, risk management protocols, and historical simulation showing the statistical basis for this relative value play.

• The Bank has reached its three-year target one year ahead of schedule
• Focus has now turned to growth and new opportunities as unleashed from full  government supervision
• Valuations do not yet discount an improvement in returns from here

• Daido Steel (5471 JP) produced FY25 (March year-end) 1H OP [IFRS basis] of ¥18,464mil (+1.1% YoY) on sales of ¥284,499mil (+0.4% YoY).
• Both sales and OP surpassed guidance which called for OP of ¥12,500mil (-31.5% YoY) on sales of ¥275,000mil (-3.0% YoY), thanks primarily to stronger than expected demand for ship engine valves in the open die forging business and despite having incurred about ¥2,300mil of costs related to the Superalloy Manufacturing Process Transformation Project, one of the firm’s ongoing strategic investments in the current MTP.
• The Mid-Term Plan [MTP], which ends in FY26, was revised down to reflect (1) a larger than expected decline in steel product sales volumes, (2) sluggish auto production and weaker than expected industrial machinery-related orders and (3) increasing lack of clarity in the business environment.

• Nicca Chemical is a leading Japanese specialty chemical manufacturer with a dual-pillar business model in Chemicals (surfactants for textiles, paper, etc.) and Cosmetics (professional hair care). The company holds a dominant market share in the domestic textile chemicals sector and is pursuing growth through high-value-added products and overseas expansion, primarily in Asia.
• The company presents an attractive valuation profile, trading at a significant discount to book value and a low P/E ratio. This is complemented by a strong commitment to shareholder returns, evidenced by a robust dividend yield and a remarkable 3-year dividend per share CAGR of over 33%.
• Future growth is expected to be driven by the “INNOVATION25″strategic plan, which focuses on increasing the sales ratio of high-value-added products (Environment, Health, Digital), expanding the cosmetics business, and improving capital efficiency with a focus on raising its price-to-book ratio.

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