Nikko itself will keep its domestic retail brokerage business, asset management and little else.
"We're entering uncharted territory, " says Hiroki Tsujimura, chief investment officer at Nikko Asset Management Co.
Even considering the Nikko sale, Citi still has a huge overseas presence in growth markets.
Nikko's 128 local branches would make great conduits for Citigroup's securities, mutual fund, banking and insurance products.
The Erector brand is now owned by Nikko, a Japanese maker of remote-control toy airplanes and cars.
These are Nikko Asset Management, UFJ Partners, Japan Investment Trust Management and Sumisei Global Investment Trust Management.
Similarly, Nikko officials balked at appointing Salomon's Alicia Ogawa as head of research.
It fired off a statement that it was "reviewing its relationship" with Nikko.
Bank of Tokyo- Mitsubishi, surpassed by Nikko's new top shareholder, Citigroup, was miffed.
Johno Toshiyuki, an analyst with Nikko, Salomon Smith Barney, says Kajima has taken a big writedown in its land assets.
It was an unusual thing for a Japanese firm to do, but Nikko called in an American partner to save it.
"Investors were worried that finance ministers would criticise the recent weakness in the yen, " said Hiroichi Nishi of SMBC Nikko Securities.
This month Nikko announced it was reserving 10% of its shareholders' equity for a new division to invest in Japanese start-ups.
"In 1996, Southeast Asia will continue to battle inflation, " says Samantha Teo, a senior portfolio manager at Nikko Capital Management in Singapore.
"After the momentum has been taken away, fundamentals will take over, " said John Vail, chief global strategist at Nikko Asset Management in Tokyo.
"Japan could come out of this crisis as a real global leader, " reckons John Vail, chief global strategist at Nikko Asset Management in Tokyo.
In June Travelers Group joint-ventured with Nikko Securities, Japan's third-largest broker.
Additionally, Citigroup is leaner than it has been in a long time, having divested itself of assets like Smith Barney, Primerica (PRI), and Japanese brokerage unit Nikko Securities.
Nonetheless, Weill will from January fold Salomon Smith Barney's 400- person Japanese unit and all of Nikko's nearly 500-person corporate division, domestic and overseas, into newly formed Nikko Salomon Smith Barney.
Using a similar tactic, Travelers Group Chief Executive Sanford Weill was in Tokyo in June to pen a deal with Nikko Securities and said his next target may be a Japanese insurer.
"Instead of betting on short-term cycles, people are investing in the longer-term story" of U.S. economic growth backed by innovation in shale-gas technology, said Kunihiro Asai, Nikko Asset Management's head of product development.
The Nikko Electric web site lists Guoping Cao as Representative Chairperson Director, but Japanese hold all other management positions, and all 200 engineers and workers at the Kanagawa Prefecture plant retained their jobs.
Tim McCarthy, chief executive of Nikko Asset Management Co. in Tokyo, said he expects the yuan to appreciate at a muted pace next year as China shifts its attention to bolstering growth from fighting inflation.
"Stocks must account for a few sessions of most positive activity in overseas markets, which have resulted in a sharply weaker yen, all of which will be tonic for buying, " said Hiroichi Nishi from SMBC Nikko Securities.
"This is the only conglomerate under the control of the Beijing municipal government so that justifies a premium, but at the current level it's a bit expensive, " says Wilson Yung of Nikko Research Center in Hong Kong.
In Britain, Barclays Global Investors, part of the banking group, has become the world's fourth-biggest asset manager after acquiring Wells Nikko, an index-fund provider that was itself the product of a joint venture between an American and a Japanese firm.
Though banks are selling shares, little is being transferred to the market, since banks sell largely to the government or the central bank which will hold them for years, or to the companies themselves, says Alexander Kinmont, a strategist at Nikko Citigroup in Tokyo.
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