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Bank of Kansai to buy majority stake in Kansai Sawayaka.

... IN BRIEF: Bank of Kansai and buyout king Wilbur Ross' Kansai Sawayaka Bank have agreed to merge, according to Japanese press reports. Bank of Kansai, which is affiliated with Sumitomo Mitsui Financial Group, will turn Kansai Sawayaka into a subsidiary by this summer and absorb it by next February. Ross' fund will continue to hold a minority stake.

... COMMENTARY: In 1999, Ross tried to persuade the Rothschild bankers to buy failed Kofuku Bank in Kansai, but they resisted. Ross then formed his own fund, WL Ross & Co., raised [yen] 24 billion and bought the bank, which was relaunched at the end of February 2001. Just a little more than two years later, he's found a buyer. Here's what he told us in a June 2002 interview when we asked him why Kofuku?

"We felt Kofuku had good branch coverage and its problems were fairly specific. They did not involve morality questions--no self-dealing or other inappropriate transactions. This is very important, because if you have problems with yakuza, it is very difficult to achieve a turnaround. Kofuku rang a lot of other bells for us, too, so we went to the government and asked to be invited to bid."

He also told us that a Tokyo purchase would be next: "Based on what we've done, we feel we are ready to compete in Tokyo, and we're very keen to enter."
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Publication:Japan Inc.
Article Type:Brief Article
Geographic Code:9JAPA
Date:Jun 1, 2003
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