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(Bloomberg) — Ariake Capital, a $320-million Japanese hedge fund founded by former Goldman Sachs Group Inc. analyst Katsunori Tanaka, is poised to make a profit of about $55 million from selling one of its major regional bank holdings.
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The Tokyo-based fund is in talks to sell its roughly 20% stake in Chiba Kogyo Bank Ltd. for about ¥20 billion ($133 million) to rival Chiba Bank Ltd., according to people familiar with the matter. Ariake acquired its stake for ¥11.7 billion, according to public filings.
Chiba Bank said in a statement Thursday it’s considering various strategic options including the acquisition of shares of Chiba Kogyo after Nikkei first reported the plan. At current terms, Ariake is set to book a gain of about ¥8.3 billion, or a return of 71% on the investment, according to Bloomberg calculations.
The windfall will extend the success at Ariake, which has returned more than 300% in roughly three years since its inception. Ariake employs a “friendly” activist strategy and focuses its investments on regional banks in Japan. In a recent interview, Tanaka said his fund wagers on lenders that intend to improve their business and stock price in the new era of positive interest rates in Japan.
Tanaka scored another potential win Thursday as local media reported that one of its other holdings, Yamanashi Chuo Bank Ltd., is planning to form a business alliance with other lenders. Shares of Yamanashi Chuo rallied 6.9% on the news. Public documents show that Ariake holds about 1.53% in Yamanashi, whose business is focused in an area west of Tokyo.
A representative for Ariake declined to comment on the deal.
Ariake recently raised money from family offices in the US, underscoring how global investors’ renewed interest in Japan has extended to money managers who can generate returns beyond the obvious targets.
Before launching Ariake, Tanaka spent 19 years at Goldman Sachs mostly as an equity analyst covering Japan’s financial sector, and rose to managing director.
More broadly, Japan’s banking shares have outperformed this year. A measure of banks on the Topix index has jumped about 14% this year, the second-best performer, while exporters such as automakers have suffered from US tariffs concerns.
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