MUFG seeks rest of UnionBanCal for $3 bln

Mitsubishi UFJ Financial Group Japan's largest bank, said it would bid $3 bln to buy the rest of UnionBanCal Corp a Californian bank it already owns two-thirds of, as it seeks growth beyond Japanese shores.
Saddled with a tepid home market and unburdened by heavy subprime losses, Japan's large financial firms are increasingly looking overseas, although a fund manager questioned whether the subprime-affected U.S. market was the place to go shopping now.
"With the U.S. economy possibly worsening, is it really a good idea to use that much money to make it a full subsidiary?," said Hiroaki Osakabe, fund manager at Chibagin Asset Management.
UnionBanCal, which has a market value of nearly $8 bln, last month reported a nearly 15% slide in net income, on higher provisions for bad loans.
Bank of Tokyo-Mitsubishi UFJ, a unit of MUFG, said it would offer $63 a share, an 8.3% premium to Monday's closing share price, for the 35% of the Californian bank it does not already own.
It joins other Japanese financial firms in seeking opportunities in the U.S., despite its subprime housing crisis.
Last month Tokio Marine Holdings Inc said it would buy property and casualty insurer Philadelphia Consolidated Holding Corp for about $4.7 bln, marking the largest acquisition by a Japanese financial firm in the United States.
Shares in MUFG, Japan's second most valuable company behind Toyota Motor Corp closed up 0.2% at 878 yen, outperforming the Nikkei average which fell 1%.