Next Generation Technology Group

Next Generation Technology Group (NGTG) operates as a serial acquirer, focusing on the Japanese manufacturing sector. The company was established in July 2018 by Eiichi Arai, who serves as the CEO. Arai's background includes roles at Mizuho Securities and as a founding member of the Innovation Network Corporation of Japan (INCJ), a government-linked investment fund. His decision to launch NGTG was influenced by a 1.5-year trip around the world, where he observed the high regard for Japanese manufacturing and the significant business succession challenges faced by small and medium-sized enterprises (SMEs) in Japan due to an aging population.

The firm's core business involves the acquisition and subsequent management support of manufacturing and manufacturing-related companies, particularly profitable SMEs with strong technical capabilities that lack successors. Unlike a typical private equity fund, NGTG employs a permanent holding strategy, meaning it does not intend to sell the companies it acquires. Instead, it focuses on long-term growth and operational enhancement. Revenue is generated from the performance of its acquired subsidiary companies, and the cash flow is used to fund further acquisitions. The business model centers on achieving growth through a continuous series of mergers and acquisitions (M&A) at reasonable valuations. The firm receives referrals for potential acquisitions from M&A advisors and financial institutions, to whom it pays a fee.

To support the growth of its portfolio companies, NGTG has developed a proprietary value-creation playbook called the NGTG Growth Program (NGP). Inspired by the Danaher Business System, the NGP offers over 150 support menus across areas like sales, production improvement, human resources, digital transformation, and business management. A key part of the post-acquisition process involves dispatching executives and leveraging NGTG's diverse team—with expertise in finance, mechanical design, IT, and production technology—to address challenges such as human resource shortages and IT adoption. This hands-on approach aims to improve operational efficiency, foster collaboration among group companies, and support overseas expansion. Since its inception, NGTG has acquired multiple companies, including Toshima Manufacturing Co., Ltd., and Kanda Iron Works Co., Ltd., and became a publicly listed company on the Tokyo Stock Exchange.

Keywords: serial acquirer, Japanese manufacturing, M&A, business succession, permanent holding, private equity, technology succession, small and medium-sized enterprises, SME investment, value creation, operational improvement, Danaher Business System, NGTG Growth Program, long-term investment, manufacturing acquisitions, industrial technology, corporate succession, portfolio management, Eiichi Arai, Tokyo Stock Exchange, Japan Exchange Group