Acquiring Nagasakiya: into the GMS, food and big-box (2007)

M&A that fills a weakness — and the template that leads to Uny

The point of this acquisition was that Don Quijote took in a weakness it could not easily fill on its own by absorbing another company’s assets wholesale. Its strengths — urban, non-food — were, turned over, precisely its weaknesses in food, in the provinces and in large-format stores. Nagasakiya carried the wound of a corporate collapse, but its store network and its handling of food supplied exactly what Don Quijote lacked. Take on a damaged company cheaply, remake it into one’s own format, and revive it — this method became the prototype for the company’s M&A thereafter.

The method of reviving large stores by converting them to the discount format would be repeated on its largest scale in the full acquisition of Uny in 2019. The template tested at Nagasakiya’s scale of 200 stores was widened to the several-hundred-store scale of Uny, with its Apita and Piago chains. That said, acquisitions that take on failed firms or ailing general-merchandise stores demand time and effort to turn around, and success or failure hinges on operating skill after the conversion. The accumulated experience of remaking a general-merchandise store into the MEGA format, gained at Nagasakiya, became the foundation that would support the larger M&A of later years.