13th Mar 2026 11:07
(Alliance News) - AVI Japan Opportunity Trust PLC on Friday said its completed combination with Fidelity Japan Trust PLC is expected to benefit all shareholders "in several ways" as it reported a higher net asset value.
The investor in small-cap and mid-cap Japanese equities said net asset value per share was 174.7 pence at December 31, up 12% from 155.4p a year ago.
NAV total return in 2025 was 14.7%, underperforming against its comparator benchmark, the sterling adjusted MSCI Japan Small-Cap index, which had a total return of 19.8%.
AVI Japan said the largest contributor was Kurabo Industries, a textile manufacturer with diversified operations that include chemicals, advanced technology, food and services, and real estate.
The second largest contributor was Raito Kogyo, which is active in the specialist construction sector.
The largest detractor was Aoyama Zaisan Networks, also known as AZN. It specialises in providing wealth management consulting services across areas such as property, succession planning, corporate finance and strategic management of individual assets.
The second largest detractor was Aichi Corp, a manufacturer of special purpose vehicles used in construction Japan, such as aerial work platforms.
AVI Japan proposed a final dividend of 0.60 pence per share.
In November, Fidelity Japan Trust PLC, known as FJV, rolled over its assets into AVI Japan.
AVI Japan said Friday: "The AJOT and FJV combination is expected to benefit all shareholders in several ways. The combination has resulted in a more liquid and larger fund. The enlarged fund will have increased capability to take influential positions in companies where AVI has identified a significant opportunity to unlock value through AVI's active engagement. AVI has agreed to a reduced management fee of a tiered structure on assets above GBP300 million and will continue to reinvest 25% of the management fee into AJOT shares. The new reduced management fee structure and the economies of scale will result in a reduced annual ongoing charge."
Looking ahead, the company said: "The Tokyo Stock Exchange continues to pressure companies to embrace corporate reform to unlock the full potential of the Japanese market. The election of Sanae Takaichi as leader of the Liberal Democratic Party [and Prime Minister] in October 2025 and subsequent resounding victory in the February 2026 general election, reinforces the effort seeking to see companies enhance capital efficiency by either reinvesting excess cash into their core business operations or returning excess cash to shareholders. Takaichi has also spoken of corporations reducing latent cash balances by investing in their employees through wage hikes, something that we believe would be supportive of long-term corporate value."
The firm added that key tailwinds for the strategy include unwinding of cross-shareholdings, increasing shareholder activism, private equity firms targeting the Japanese market, and the Japanese government encouraging unsolicited acquisition offers.
AVI Japan shares were 1.4% lower at 177.57 pence each on Friday morning in London.
By Tom Budszus, Alliance News slot editor
Comments and questions to [email protected]
Copyright 2026 Alliance News Ltd. All Rights Reserved.
Related Shares:
Avi Japan Oppo.