- Advent International will reopen a Tokyo office in 2026, returning to Japan 15 years after exiting in 2011, and naming Tomohide Handa to lead the effort.
- It is reentering as Japans private equity market accelerates, with record M&A volumes, rising take-privates and carve-outs, and strong long-run PE returns.
- Other global firms are also expanding in Japan on governance reforms and demand for better capital efficiency, intensifying competition.
- Key risks include higher valuations, tougher deal sourcing, slower exits, and macro and currency uncertainty despite favorable market momentum.
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Advent International’s return to Japan after a 15-year absence signals a broader shift in how international private equity (PE) firms view the Japanese market. Originally opening its Tokyo office in 2001 and launching a ¥60 billion fund for Japanese investments in 2008, Advent closed its local operation in 2011 following the global financial crisis. Its new office in 2026, staffed under Managing Director Tomohide Handa (formerly of MBK Partners), underscores a renewed commitment to source and execute take-private, carve-out, and value creation opportunities in Japan. Advent’s global assets under management (AUM) are approximately $100 billion as of mid-2025.
The operational backdrop for Advent’s reentry is a Japanese PE environment experiencing strong tailwinds. M&A deal value involving Japanese companies reached ¥33 trillion in 2025, setting new highs. [Primary] Concurrently, the 10-year IRR for Japan-focused private equity funds (2014-2023 vintage) averaged ~16.9 %, surpassing global averages, while five-year returns are around 14.5 %; both notably outperform the TOPIX total return benchmark.
These returns and deal volumes are fueling increased activity by foreign players. Ares Management has expanded operations in logistics and real estate including data centers; Warburg Pincus reopened its Japan office in late 2024; and firms such as Jolt Capital are dedicating a sizable portion of new fund deployment to Japan, especially in high-growth sectors like semiconductors, health care, cybersecurity and energy. Advent itself outlines five core sectors for its Japanese investments: consumer goods, business & financial services, manufacturing, health care, and technology.
Strategically, Advent and other PE firms must balance opportunity against risk. Entry valuations are rising, competition is intensifying, and exits are under longer timelines (portfolio aging). Also, favorable interest rates and low corporate leverage enhance buying power now, but macroeconomic turbulence or policy shifts could erode this advantage. Governance reforms and M&A filters are enabling more companies to go private, but Japanese firms’ cultural aversion to PE remains a potential friction point.
Looking ahead, potential scenarios include heightened government-led reform accelerating delistings, increased collaboration between foreign GPs and domestic sponsors, rises in private credit and distressed/debt instruments, and more aggressive deployment into sectors ripe for modernization. Advent is well positioned, but success will depend on local execution, regulatory navigation, and value creation beyond financial engineering. Open questions remain around exit liquidity, currency risk (yen fluctuations), and how domestic governance reforms translate into consistent deal flow.
Supporting Notes
- Advent had a Tokyo office in 2001, launched a ¥60 billion fund for Japan in 2008, but closed the office in 2011 due to changing environment after the global financial crisis.
- Advent’s global assets under management reached $100 billion as of end of June 2025, with allocation roughly 40-45 % to each of U.S. and Europe, now shifting more focus into Asia-Pacific including Japan.
- Advent’s Japan team will invest across five sectors: consumer goods; business & financial services; manufacturing; health care and technology.
- In 2025, deals involving Japanese companies reached a record ¥33 trillion. Number of Japanese companies going private in 2025 was 125, up from 94 in 2024, marking consecutive record years. [Primary]
- The annualized return (10-year horizon through end-2023) for Japanese PE investments was ~16.9 %, above global average of ~14.2 %.
- Private equity deals in Japan (including venture capital) were $17.9 billion in 2024, up 40.8 % year-on-year; Japan’s share of Asia-Pacific’s total rose from ~10.6 % in 2023 to ~15.6 % in 2024.
- Take-private deals are rapidly increasing; as of August 20, 2025 PE deals had hit $27.6 billion, nearly triple the same period in 2024; projected to exceed $40.3 billion by year-end.
- Japan’s listed companies’ return on equity averaged ~9.1 % as of December 2023, below ~17.9 % in U.S. and ~14.1 % in Europe. Net profit margin similarly lower (~5.9 % vs ~10.6 % U.S.).
- Valuation, competition, portfolio aging, and exits timing are recurring risk concerns cited by multiple reports for domestic and international GPs targeting Japan.