Yasuda U.S. Accord Is Aimed at Gaining Finance Technology --- Pact for PaineWebber Stake Arose From Effort to Trap High End of the Business
TOKYO -- Yasuda Mutual Life Insurance Co.'s agreement to purchase an 18% voting stake in PaineWebber Group Inc. marks an effort by the big Japanese insurance company to tap the high end of the financial business.</br></br>The $300 million accord, announced Monday, will give Yasuda access to the "financial high technology" that so many Japanese financial companies are obsessed with these days. "We need their technology," said Kyosaku Sorimachi, managing director of Yasuda. "We need to train our people through PaineWebber, to get their know-how." Mr. Sorimachi said that the accord allows Yasuda to send as many as 150 people through the PaineWebber organization for various kinds of instruction.</br></br>The Yasuda official said that "global asset management" is very high on the list of things PaineWebber can teach. Yasuda is the fifth-largest Japanese life insurer, with $22 billion in assets. About 17% of those assets are invested abroad, in bonds, stocks, real estate and loans to non-Japanese.</br></br>PaineWebber hopes, for its part, that the association with Yasuda will help the U.S. firm's presence in Tokyo. Yasuda is an old-line, well-connected and very large organization. Yasuda could introduce PaineWebber to potential clients, steer business its way and provide insight into the working of the Tokyo markets, especially the Tokyo stock market.</br></br>Yasuda is being somewhat coy about how helpful it will be to PaineWebber beyond supplying the firm with $300 million and putting two of its own people on PaineWebber's board. (Yasuda also agreed to purchase warrants that could eventually be converted to give the Japanese company 25% ownership of the U.S. firm.)