Jamie Halse (Senjin Capital) 🇳🇿🇦🇺🇯🇵

Japanese stocks are rallying to heights not seen since the 1990s. Back then it was the aftermath of bubble valuations. Now, there is a solid foundation of earnings growth, corporate governance improvements, and increasing cash returns to shareholders! 1/n

@TheLongHappy If only shareholder activism were a thing in China!

compared to the up and downs of Japan, this is boring, but $NOAH is dividending 11% and buying back 4+%. The cash is real and this is cheap! No position though - I'm concerned about the pivot in business model... It is cheap though!

@SleepwellCap @ClarkSquareCap

Who is the best private investor/private fund investing in Frontier Markets? ie. Markets that are extremely hard to operate locally and with high geopolitical risk

@SleepwellCap @ClarkSquareCap @lt3000 has done a pretty amazing job

This is looking set to be a great event. Sign up to learn all about the investment opportunities in Japan. I am part of a panel discussion with participants from PE firm Potentia, Quantum Brilliance, and Medtech Actuator. Come along and say hi!

@Tanmedia True. Maybe lower labour costs there make the economics less favourable. A big part of the proposition is saving labour.

@JamieHalse They need to get to Kazakhstan - huge potential and strong growth as a farming / beef producer. Guess there's nothing stopping the Kazakhs from creating their own Halter.

Want to learn how to not make $80m? It's simple. Have the opportunity to co-invest NZ$25k in Halter in 2016 at $750k pre-money valuation, and not seize it. Halter just raised money at a NZ$3.3bn valuation from Peter Thiel's Founders Fund, and Blackbird Ventures. Congratulations to the Icehouse Ventures team on backing such a huge winner from the earliest stage, and to the Halter team for the incredible job in building a wonderful business and innovating to bring advanced tech to an area where New Zealand has key strengths - agriculture, and dairy farming in particular. Icehouse Ventures often offers investors in its funds co-investment opportunities in funding rounds it participates in. Over the years I have reviewed four or five of these seriously, and invested in two. One of these paid out 3x, the other 20x+, I passed on the rest and for 2/3 that was a good decision. So all in, a pretty great result. Sadly, I passed on Halter. This is the one I should have understood best, due to spending a lot of my childhood school holidays on my uncle's dairy farm in Northland, NZ. Ironically, had I never stepped foot on a dairy farm, nor had family living the farming life, I may not have passed on it! Dairy farmers are a sceptical lot, and the highest tech system on the average NZ farm a decade ago was the farmer's iPhone (or more likely Android phone - farmers are very cost conscious). Halter is changing this rapidly. My $80m estimate is likely an exaggeration. I am sure the $750k valuation reflects a very different equity structure to the NZ$3.3bn one, with initial investors experiencing dilution along the way. But, whatever the true number is, it is large! It is some consolation that I have a small exposure via an investment in Icehouse Ventures' seed fund, but a direct investment would have been much nicer. For any wholesale investors interested in the NZ VC scene, I recommend getting in touch with Icehouse Ventures, and follow Robbie Paul. Icehouse has a fantastic network of NZ founders, and get great deal access. The vast majority of the companies they invest in have global potential - NZ is too small a market to build a truly large company - but early investors pay NZ VC valuations, rather than US ones. This can make the payoffs much larger - as Halter demonstrates.

Has a tonne of cash, investment securities, and real estate on the balance sheet, and an activist growing its stake on a relatively open register. Otherwise it would be a value trap. Management, observably, does not care about the share price. Most of its brands are subscale and would be better off owned by someone else, but it has some great ones in there. I used to own a chunk in the fund I managed previously.

Ice cream vending machine from Glico. Not an exciting business but company has zero debt on balance sheet and its stock is up 39% in 2 years

@tommyr345 Sounds interesting. What’s the annual lease expense?

Myer earnings call, flat result, plan is leverage Myer One as competitive advantage, Just Jeans sales +8.9pc yoy, Solly Lews owns ~28pc, main takeaway stock looks CHEAP with $287m cash, no debt, trades on EV (~$320m) to just over ~3x annualised profits ~$100m, (1H26 was $51.7m) around 5x market cap of $500m at 28c, market not keen on outlook! $MYR

Edit button has expired, below is the updated post with corrected figures: Bain Capital's Tokyo office may now host one of the most profitable private equity buyout deals in history. - post has been edited from the original as industry sources informed me of some errors A single investment in Kioxia, fuelled by the AI boom, has produced what is likely close to the single best profit of any private equity buyout deal in history. Bain Capital IPO'd KIOXIA Group, the inventor of NAND memory, in late 2024, having acquired a controlling stake from Toshiba at a valuation of 2trn yen (around US$12bn today) back in 2018. Bain retained a large stake in the company, and despite progressively selling down, still holds 29%. Thanks to the AI boom, Kioxia stock is up more than 10x since IPO, and is now valued at US$75bn, creating a huge windfall profit for Bain's investors, and massive carried interest for Bain Capital and its employees. Bain may have contributed as little as $1.3bn of equity into the initial transaction, but even this contribution may have been levered further up the chain. Bain's remaining stake and amounts already sold per public disclosures amount to more than US$30bn, but using the PE playbook Bain likely structured various deals along the way to realise cash earlier vs the disclosed holdings, so it is doubtful the most recent boom has been fully beneficial. Let's assume, in very rough numbers, a round $10bn equity profit, which already likely makes this close to the single most profitable private equity buyout deal of all time - maybe only trailing Blackstone’s Hilton acquisition. If they can exit at current valuations, the carried interest on that is $2bn, and the employee share of that likely $0.8bn-$1bn. Bain distributes this relatively evenly amongst the global partnership and employees - with obvious adjustments for seniority, so this deal is a major breadwinner for Bain partners globally. There is a lot of hard work involved in investing, but sometimes it is about being in the right place at the right time. The crazy thing is, the people inside Bain are likely kicking themselves for IPOing the business and selling down their stake too early! But even crazier is that Bain's earlier bad luck - not being able to IPO at its first attempt in 2020 - turned out to be the best thing that could possibly have happened! Similarly, the proposed deal with Western Digital that fell apart in 2023. The Bain team would have worked incredibly hard at many stages of the process of this investment, but the AI boom created a tail outcome like no other. If you enjoyed this, sign up to Senjin Capital's monthly newsletter at our website. We discuss Japan markets generally, as well as the corporate governance reform, shareholder activism, and M&A in Japan in detail.

@BainCapital's Tokyo office may now host some of the wealthiest private equity people globally. A single investment in @KIOXIAHoldings, fuelled by the AI boom, has produced what is likely the single best profit of any private equity buyout deal in history. Bain Capital IPO'd KIOXIA, the inventor of NAND memory, in late 2024, having acquired a controlling stake from Toshiba at a valuation of 2trn yen (around US$12bn today) back in 2018. Bain retained a large stake in the company, and despite progressively selling down, still holds 29%. Thanks to the AI boom, Kioxia stock is up more than 10x since IPO, and is now valued at US$75bn, creating a huge windfall profit for Bain's investors, and massive carried interest for Bain Capital and its employees. Bain may have contributed as little as $1.3bn of equity into the initial transaction, but even this contribution may have been levered further up the chain. Bain's remaining stake and amounts already sold amount to more than US$30bn. Let's assume, in very rough numbers, a round $30bn equity profit, which already likely makes this the single most profitable private equity buyout deal of all time. If they can exit at current valuations, the carried interest on that is $6bn, and the employee share of that likely $2.4bn-$3bn. Bain’s entire Tokyo office is 44 people per its website, and you can guarantee the proceeds will not be shared equally! Even if a large chunk is shared with Boston staff, the numbers are still mind-boggling. There is a lot of hard work involved in investing, but sometimes it is about being in the right place at the right time. The crazy thing is, the people inside Bain are likely kicking themselves for IPOing the business and selling down their stake too early! But even crazier is that Bain's earlier bad luck - not being able to IPO at its first attempt in 2020 - turned out to be the best thing that could possibly have happened! Similarly, the proposed deal with Western Digital that fell apart in 2023. The Bain team would have worked incredibly hard at many stages of the process of this investment, but the AI boom created a tail outcome like no other. If you enjoyed this, sign up to Senjin Capital's monthly newsletter at our website. We discuss Japan markets generally, as well as the corporate governance reform, shareholder activism, and M&A in Japan in detail.

@kjnkjp Can't have security in Japan without Hennge!

System integrators (SIs) in Japan losing momentum - seems like back-end upgrades have now come full circle. Visualizing what SIs provide below - next in focus is the workflow layer + data analytics. I.e. Not all SIs should be treated equal, going fwd. Focus on workflow + data.

@GearoidReidy It’s a struggle to even be “expert” in my own very narrow sphere. Things keep changing quickly and there are always new data points.

"These days it seems pretty bogus for anyone to posit themselves as an "Expert on Japan" or a "Japanologist". Is there really anyone who simultaneously knows all about Japanese philosophy and manga and Japanese politics and Japanese economic history and cinema and legal systems and so on and so on? You don't after all come across people who claim to be an "Expert on America".

There are many approaches to investing in Japan. Senjin Capital uses shareholder activism to unlock the deep value trapped inside many small Japanese companies. Isabella Foley and @ForagerFunds take a different, but complementary approach, preferring stocks that are growing well but trading at very reasonable prices. In this clip we discuss the appeal of each of the approaches and the opportunities to apply them in Japan. For the full video, see the link in the comments.

The battle between Elliott Investment Management L.P. and the Toyota Group was one for the ages. Huge amounts of money and prestige were involved, with probably the world's largest activist hedge fund facing off against the world's largest automotive group. Both sides walked away with a win, with Elliott winning a 26% uplift from the original deal price in the space of a few months, while Toyota got away with a still very under-priced deal that transfers value from outside shareholders to the group (and potentially the Toyoda family disproportionately). I wrote about this situation and a number of other similar ones in our monthly newsletter last month, as well as the new Japanese "serial acquiror" phenomenon. In particular, how activists are pursuing this strategy. It will be an interesting space to watch. See the link to the full piece in the comments, and don't forget to sign up for our newsletter.

Senjin Capital is in Melbourne this week. Tsubasa Umezaki and I had a great lunch with investors yesterday, organised by the ever effervescent @alxlowen. The best meetings are true conversations where everyone walks away having learned something, and feeling like they have benefited from the discussion. That was certainly the case yesterday where we gained insight into the private wealth market, medical technologies, and even the dynamics of AFL club memberships! More meetings in Melbourne today, then back to Sydney tonight.

It was great to sponsor the Private Wealth Network Private Markets Forum in Sydney yesterday, and get a chance to present to a sophisticated audience of high net worth and family office investors on the incredible opportunity we see in Japan for Senjin Capital's shareholder activism to unlock the value trapped inside many Japanese small cap companies. Thanks to @richmilroy for having me and Tsubasa Umezaki along to the event. While technically our investments are in the public markets, our approach has a lot more in common with private equity than it does with traditional fundamental stock-picking, and we do have the flexibility to hold private assets, so it was relevant content for the receptive and engaged audience. It was also a pleasant surprise to meet some investors in the room who are already invested in the Japan shareholder activism theme! I look forward to the next event PWN we are involved in - the Sydney Investment Insight series in September, and hope to see some familiar faces in the room.

@The_scanner_man Take a video, send it to ASIC.

I remember an auction I attended late last year, auctioneer was telling everyone it was a great time to buy with "rate cuts coming soon" yikes.

Wow! That's another $12m/yr of very high margin revenue. You have to hand it to Rafi and Mark - they know how to capitalise on delivering great performance.