Cross-holdings begin to unwind

Japan’s corporate cross-shareholdings are being unwound at an ever-increasing pace as the historical ties have come to feel more like handcuffs for modern management. But while in Germany – the other major economy where corporate groupings built in the aftermath of the Second World War are breaking up – the exchangeable bond has been used extremely effectively a number of times, it is yet to become a commonly used instrument in Japan. “We are extremely keen to get the orthodox, corporate listed exchangeable bond structure working in Japan,” says Michael Remington, a managing director in Credit Suisse First Boston’s investment banking division.