(Nov 29): Mitsubishi UFJ Financial Group Inc (MUFG) plans to buy Japanese robo-adviser WealthNavi Inc for as much as ¥99.7 billion (US$665 million or RM2.96 billion), as it looks to expand its financial technology (fintech) capabilities and cater to households going online to invest more of their savings. 

Japan’s biggest bank is seeking to purchase WealthNavi through a tender offer at ¥1,950 a share, and make it a wholly owned unit, according to a filing on Friday. That represents an 84% premium over the fintech company’s closing price on Thursday.

Japanese financial firms are expanding services to help households invest more of their US$7.5 trillion in cash, as inflation emerges in Asia’s second-largest economy. More people have been opening so-called Nisa accounts, following the expansion of the country’s tax-free investment programme this year, helping to fuel a stock-market rally. 

MUFG took a 15% stake in WealthNavi earlier this year. The Tokyo-based asset manager, which listed in 2020, had a market capitalisation of ¥62.8 billion before news of the deal emerged. 

Shares of WealthNavi jumped 28%, the most in almost four years, to ¥1,358 in Tokyo on Friday, after being untraded during the session. That pared this year’s decline to 30%. MUFG gained 1.3%, taking this year’s advance to 48%. 

Acquiring WealthNavi would boost MUFG’s prospects for “creating a more comprehensive finance super-app”, Koichi Niwa, an analyst at Citigroup Inc in Tokyo, wrote in a note. It would also help WealthNavi provide a full range of financial services on its platform, he added. 

Founded by chief executive officer Kazuhisa Shibayama in 2015, WealthNavi provides online wealth management services, including automated transfers of cash to investment products. It managed ¥1.34 trillion as of Oct 31, according to an earnings presentation. It expects operating profit of ¥531 million this year.

Japan’s robo-advisory market is projected to reach ¥3 trillion this fiscal year, and forecast to grow to around ¥12 trillion by 2030, according to Yano Research Institute.

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