Triangular Mergers in Japan


As of May 1, 2007, provisions of the Corporation Law[1] providing for “increased flexibility in merger

consideration” came into effect[2]. This newsletter outlines how triangular mergers have been made possible[3] by this “increased flexibility in merger consideration”, under the Corporation Law and other laws and regulations.


A “triangular merger” refers to a merger in which the surviving company (Company C) delivers shares of its parent company (Company A) to shareholders of the merged company (Company B)instead of its own shares (see PDF chart) [4].

Japanese and non-Japanese companies can use the triangular merger structure to complete acquisitions. This newsletter will look at triangular mergers from the perspective of a non-Japanese acquirer, in light of the attention that the triangular merger structure has received as a way for non-

Japanese companies to complete acquisitions in Japan using their shares as the transaction


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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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