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. Last Updated: 07/27/2016

Nomura, Rothschild Link Up M&A Business

TOKYO -- Investment banks Nomura Holdings and Rothschild have formed an alliance in the merger and acquisition advisory business, extending each other's clout overseas.

The alliance will focus on cross-border M&A between Europe and Japan, allowing the banks to benefit from each other's client bases, the banks said in e-mailed statements Tuesday.

The alliance with Rothschild -- ranked fifth in the European M&A league table and 10th in the global market in 2004 -- helps Nomura gain more clout in handling cross-border M&A deals between Japanese and European companies.

Rothschild, whose ranking last year was boosted by its role in the Aventis-Sanofi M&A deal worth around $70 billion, could also bolster its Japanese investment banking operations, which have been lagging those of its European rivals. A spokesman for Nomura said it has no plan now to develop the alliance with Rothschild to include capital partnership.

Back in 1990, Nomura enjoyed the status as the world's biggest securities house and dominated eurobond issuance league tables. It tumbled from grace, however, sacrificing its overseas operations in 1998 when it posted a stunning $4.5 billion loss from a slump in U.S. commercial mortgage-backed securities and Russian bonds.

The new alliance is the latest attempt by Nomura to raise its global profile and narrow the gap between it and top global peers such as Goldman Sachs and Morgan Stanley. In 2001, Nomura formed a capital alliance with U.S. investment bank Thomas Weisel Partners to beef up its M&A business in the United States.