Japan "is ripe" for more mergers and acquisitions as companies have ample cash and the level of takeover activity is lower than it should be, according to Goldman Sachs Group Inc.
Japanese companies should consolidate in industries where there is excessive competition, and be more aggressive in making acquisitions in Asia, where the long-term growth potential is high, Kathy Matsui, chief strategist for Goldman in Japan, said Wednesday.
Corporate cash balances are at record highs, the yen is near its strongest level in 15 years, share valuations are low and companies are selling cross-held shares, making mergers and acquisitions more attractive, Goldman said in a Saturday report.