Japanese finance group Orix is set to diversify its operations by launching a private equity fund in 2024, targeting USD1bn to USD2bn in investor contributions, according to a Nikkei report. Orix President and CEO Makoto Inoue acknowledged limited growth prospects in leasing and banking, even with potential interest rate hikes. The move comes as a strategy to seek higher returns and reduce reliance on self-funded investments, which pose credit rating risks. Orix has a history of successful self-funded investments, including the profitable sale of accounting software developer Yayoi to KKR and the acquisition of DHC. However, shifting to a buyout fund model will allow Orix to manage assets without increasing its risk profile.
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