Activist Investing Booms in Japan, Led by Elliott’s Successes

There’s never been a more popular time to be an activist investor in Japan.

For activists, the country has always been seen as fertile but dangerous ground, full of cash-rich companies that trade at extreme discounts. But for years, a closed-off business world resisted outsiders, making the strategy an exercise in frustration. That has changed as the government and the Tokyo Stock Exchange have aligned to push corporate Japan to pay more attention to shareholder returns. International hedge funds like Elliott Management Corp. and home-grown investors such as Strategic Capital Inc. have turned the country into the world’s second-largest market for activists, outstripped only by ...