Any company looking to conquer the Japanese market must find the reliable sources of capital it needs to start and build a business in Japan. Significant funds will be required for registering a company in the United States, obtaining official permits and licenses, implementing large investment projects, hiring employees, renting premises, purchasing land and other purposes. Large financing for businesses in Japan can be challenging, especially when it comes to capital-intensive investment projects with a strong innovation component and a high level of risk.
Viola Funding Limited with many years of investment experience, is ready to help finance large projects Japan. We offer large long-term loans, organize project finance, create and manage SPVs, provide financial modeling services. Our experienced team guarantees comprehensive support to our clients at all stages of business development.
Funding for large companies in Japan: The best Source
There are a lot of famous means to finance a large business in Japan.
The most widespread ways to raise capital are by issuing stocks and bonds, as well as obtaining a bank loan.
Venture financing is less commonly used, as well as various mezzanine financing instruments for MBO deals, and so on. Not all of the above methods of financing a business are available to every business.
To receive funding, the founder (owner) of the company must properly prepare both the company itself and the entire process of raising capital. Although Japanese legislation is generally liberal, high competition for capital between companies dictates tough conditions for raising funds.
Professional support and financial consulting services are in great demand in Japan, since many procedures are legally complex and require many conditions to be met.
Bonds vs loans for financing businesses in Japan
In Japan corporate finance practice, bonds and loans are among the most widely used instruments.
These instruments are very different from each other, offering different opportunities for funding participants. The first difference is that a loan is a simpler instrument for a company than a bond.
For this reason, bonds are most often used in situations where financing involves a large company / project and significant investment costs.
Another difference between these instruments is the way in which the principal and interest are paid off. In the case of bonds, the principal is paid off at the end of a specified period and interest is paid regularly in shorter periods.
Viola Funding Limited offers large financing for businesses in Japan, including long-term loans of $50 million or more for up to 20 years.
Preparing for company financing in Japan
Preparatory activities should begin even a few months before the planned date of the project implementation.
This is because it can take a long time to complete certain optimization steps. However, a lot depends on the specifics of the company or industry. In all areas, working with trusted advisors specializing in investment, finance, accounting and legal matters should be key.
Regardless of what type of business financing a company is looking for, it is always necessary to prepare detailed investment materials for its future partners. The attitude of Japanese investors to such materials is very reverent, so this element can be called an important stage in preparing for financing. These materials differ depending on the specific type of financing.
Loans vs Bonds for Japanese businesses
In Japan, corporate finance practice, bonds and loans are among the most widely used instruments.
These instruments are very different from each other, offering different opportunities for funding participants.
The first difference is that a loan is a simpler instrument for a company than a bond. For this reason, bonds are most often used in situations where financing involves a large company / project and significant investment costs.
Another difference between these instruments is the way in which the principal and interest are paid off. In the case of bonds, the principal is paid off at the end of a specified period and interest is paid regularly in shorter periods.
A large business loan can be provided with or without collateral. The loan may be secured, inter alia, by real estate and equipment used in production, stocks of raw materials or other liquid assets at the disposal of the borrower at the time of signing the loan agreement.
Factors influencing the choice of Japanese company financing
Early stage companies have limited funding choices.
Most often, bank lending in Japan is not available to them most times. Basically, creditors’ doubts are related to the short life of the company and insufficient reliability.
As the company grows and investment risk decreases, the number of business financing options increases. Lenders take into account the company’s financial health, organizational structure, operating history, and a number of other factors.
Equity financing is available for limited liability companies and joint stock companies.
Large bank loans for business development in Japan
Obtaining a bank loan for Japanese companies in practice is usually a complex process that requires the preparation of many documents and multi-stage negotiations with potential lenders. Large industrial business loans are rarely provided to young companies that have been operating for less than 1-2 years.
Banks providing business loans in Japan include:
•Bank of Tokyo-Mitsubishi UFJ
•Mitsubishi UFJ Financial Group
•Mizuho Financial Group
•Mitsui Banking Corporation
Possible business lending purposes include the following:
•Purchase of an existing business.
•Expansion or modernization of production.
•Purchase of real estate / equipment.
•Refinancing / debt consolidation.
•Replenishment of working capital, etc.
Financing a business in Japan requires among other things, providing the bank with information about the company’s current business situation and market conditions, as well as financial forecasts.
Benefits of large loans for business in Japanese
Unlike project finance schemes, traditional bank lending usually does not require lengthy multilateral negotiations and complex contractual structures.
The main advantages of a loan include the relative ease of obtaining, which is mainly reduced to the provision of financial documentation and the conclusion of a loan agreement.
The main advantages of a business loan Japan:
•Ease of obtaining borrowed funds and quick access to financing.
•Possibility of attracting large sums up to several tens of millions of dollars.
•Flexible terms of lending depending on the needs of the business.
•Clear regulation of credit activity by American laws.
Viola Funding Limited can help you obtain large financing for businesses in Japan and other countries, working closely with partner banks and other financial institutions. We are ready to offer a loan of $ 50 million or more for up to 20 years to help your company implement a new investment project or refinance debts.
Funding large companies in Japan through bond issuing
Issuing bonds to finance business in Japan can be an extremely interesting alternative to conventional funding sources, primarily suitable for large companies seeking significant capital for investment projects.
Venture financing of large business in the Japan
Venture funds play an important role in financing young companies with ambitious capital intensive projects in Japan.
This is the moment when a company needs significant funds to bring a product (service) to market widely.
Are you interested in financing a business in Japan? Contact us and outline your investment plans. We are ready to help you at any stage of your business project implementation.
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Website:https://viola-funding.com/