{"text":[[{"start":11.4,"text":"Japan has moved to block a South Korean private equity group’s proposed ¥274bn ($1.7bn) takeover of a machine tools maker on national security grounds."}],[{"start":24.1,"text":"The government’s request for MBK Partners to drop its attempt to buy Makino Milling comes as Prime Minister Sanae Takaichi seeks to boost Japan’s ability to defend its interests in defence, supply chains and critical minerals."}],[{"start":38.650000000000006,"text":"Makino said in a filing on Thursday the government had determined it held data that constituted “sensitive information” related to national security because its machine tools were “widely used by manufacturers of defence equipment in Japan”."}],[{"start":52.60000000000001,"text":"Implementing any measures to address the government’s concerns, such as limiting access to data, would be “incompatible” with MBK’s investment objectives, it added."}],[{"start":62.45000000000001,"text":"MBK has until May 1 to decide whether to drop out voluntarily, after which Japanese authorities can take stricter measures to end the deal."}],[{"start":70.75000000000001,"text":"Makino shares fell as much as 10 per cent on Thursday. The Nikkei 225 index was down 1 per cent."}],[{"start":77.90000000000002,"text":"The intervention is the first since Japan revamped its rules for foreign takeovers in 2020. Previously, it blocked a UK hedge fund from raising its stake in utility J-Power in 2008."}],[{"start":90.10000000000002,"text":"In February, Takaichi also unveiled plans for a sweeping overhaul of Japan’s foreign investment screening system with the intention of modelling it on the Committee on Foreign Investment in the US."}],[{"start":102.45000000000002,"text":"Establishing what she calls a “Japanese version of Cfius” is one of Takaichi’s policy priorities after her landslide election victory in February and comes alongside a renewed push on defence. There is a growing sense in the country that it needs to protect sensitive sectors from potentially harmful foreign interference, particularly from China."}],[{"start":123.15000000000002,"text":"Blocking MBK’s takeover could send a chill through foreign private equity groups, which have become more active in buying Japanese companies in recent years."}],[{"start":132.75000000000003,"text":"Makino said MBK “received this recommendation with surprise” because it had been communicating with the Japanese government for 10 months after agreeing a deal."}],[{"start":142.50000000000003,"text":"MBK said it was “carefully reviewing the Japanese government’s recommendation”. Japan’s trade ministry did not respond to a request for comment."}],[{"start":151.05000000000004,"text":"Makino manufactures so-called mother machines that are essential for producing high-precision components such as aircraft engine blades and vanes."}],[{"start":160.00000000000003,"text":"MBK swooped in to take Makino private after Nidec, a highly acquisitive Japanese company, made a rare unsolicited offer for the group last year. It dropped out of the bid after Makino mounted a strong defence, including the use of a poison pill that involved issuing free stock warrants to existing shareholders."}],[{"start":182.60000000000002,"text":"Nidec has since become embroiled in an accounting scandal."}],[{"start":186.45000000000002,"text":"US buyout group Carlyle, alongside some Japanese companies, is also interested in a deal, according to people familiar with the matter. Carlyle declined to comment."}],[{"start":196.00000000000003,"text":"MBK is one of Asia’s largest private equity groups, specialising in buyouts of mainly South Korean and Japanese companies."}],[{"start":204.55000000000004,"text":"It was founded by former Carlyle executive Michael Byung Ju Kim, known as the “godfather of Asian private equity”, in 2005 and has $33bn of assets under management."}],[{"start":216.30000000000004,"text":"MBK is currently involved in a dispute over control of Korea Zinc, the world’s largest zinc smelter."}],[{"start":229.90000000000003,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1776939892_3093.mp3"}