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KKR mulls Japan credit push

With Japan already the destination for about 40% of its investment activity in Asia, private investment major KKR & Co is now weighing up a move into the country’s private credit market, according to a report by Bloomberg.

The report quotes Hiro Hirano, Head of KKR Japan, in an interview: “It will be a medium to long-term initiative. I think it is very important in Japan that we do it ourselves.”

While the private credit industry has in the US and Europe has swelled to around $1.7tn — with lenders focusing on companies with high credit risk and private equity funds that need help financing acquisitions — in Japan, most direct lending has been conducted overseas and the domestic loan market is dominated by major banks.

The firm sees Japanese companies as being increasingly willing to sell non-core businesses that can do better as individual entities in carve-outs that often provide higher returns than other investments.

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