On the day that nationwide coronavirus attacks topped 2,000 on march 25, japans biggest sugar manufacturer unveiled it had started merger talks using its two smaller domestic rivals.

Not surprisingly, not many men and women outside of the business noticed the low-key announcement, aside from its value during the worldwide pandemic.

Nevertheless deal is striking because a tie-up between mitsui sugar and dai-nippon meiji sugar would have been unthinkable a few years ago. the businesses are supported by two of countrys strongest general trading groups mitsui and mitsubishi whose rivalry runs a considerable ways back to prewar japanese corporate history.

Not just will be the two foes today coming together due to the severe company environment, they are bringing along a 3rd team, nippon beet sugar production, to create an alliance with combined annual income of $1.8bn.

A was sobbing aside for combination. japans yearly consumption of sugar has fallen 30 percent previously three years; less expensive options and sweeteners from overseas tend to be accessible despite tariffs; and customers and policymakers internationally are waking up towards the issues that a high sugar diet reasons. but modification has not been quick to take place.

Long before prime minister shinzo abes push for free-trade deals and the opening up of certain areas of the economy, it had been apparent dai-nippon meiji with yearly sales of simply $300m would not be able to go it alone permanently. however, it carried on to jostle with a dozen-plus competitors in a little business where beet and cane farmers have long already been greatly shielded because of the government.

This challenge for success in a market with a decreasing population is emblematic of a range of issues, from inertia and inefficiency to not enough internationalism, which have sometimes held straight back business japan.

If the sugar merger does come through, the good thing, together chief executive close to speaks on offer recently forecast, usually it won't be the final.

Bankers said government officials look keen to make use of the coronavirus crisis to encourage nationwide champions. but even without prodding through the state, japanese companies since ahead of the outbreak have hidden old rivalries, offering increase to a string of tie-ups in motorcycles, construction organizations and pharmacy stores. similar is true for more recent companies, with messaging app line likely to incorporate with z holdings, the softbank-backed internet group formerly called yahoo japan.

The trend for mergers has-been partly driven by wider governance reforms. conglomerates including hitachi, toshiba and sony were offloading valuable non-core possessions in reaction on modifications, providing them with the monetary firepower to follow possessions home and overseas.

Last year, japanese companies invested $56bn on purchasing domestic competitors, the greatest amount since 2007, although the range domestic merger and acquisition deals struck an archive 3,000, according to study team recof.

Activity has actually, normally, slowed this year due to the pandemic: spending on domestic m&a is down 30 percent weighed against this past year.

Still, there are encouraging signs that the trend will continue.

Takeda pharmaceuticals, which closed a 46bn offer for irish drugmaker shire this past year, is in talks to sell its domestic over-the countertop medication business for a couple of billion dollars to cut back its debt. folks close to the price said rates is actually more challenging due to the pandemic but domestic strategic purchasers and private equity groups are nonetheless revealing interest in the business.

Sony, at the same time, has actually launched a $3.7bn provide purchasing completely shareholders in its profitable economic solutions company, while nec last month sealed a merger with japans largest telecoms operator ntt.

As global deals have collapsed in other places, hitachi has finished its $11bn purchase of abbs power grids unit, while mitsubishi heavy industries sealed its $550m acquisition of bombardiers regional jet company.

Merging with weakened rivals home isn't a viable survival method by itself, which explains why primary executives generally speaking play-down the notion of extensive domestic combination and choose alternatively for outgoing discounts and cross-border partnerships.

But there are specific areas of japan inc from automobiles, chemicals, heavy sectors to shipping might gain considerable advantages of having a lot fewer competitors and targeting places where there clearly was genuine development. if this sugar deal is any indicator, company employers might be able to make the most of this crisis to emerge more powerful by putting to sleep historical rivalries.