Shares of Credit Saison (8253) jumped 11%, while Orix (IX: 37.88 +0.34%) (8591) rose a muted 3%, on the report of merger talks. (See Reuters clip below). HOWEVER, shares of both have fallen sharply over the past year (there’s even more red over the past two years) compelling one to wonder why an alliance wasn’t formed earlier. Ultimately, Orix shareholders will be rewarded (no details yet if cash/stock merger), but a portion of existing owners of Saison will take a hit (which begs the question of whether Mizuho (MFG: 3.15 +0.64%) (8411) will sell its stake). Orix is a great company, but there’s seemingly no rush to get in given broader market pressures.

clipped from www.reuters.com Japan’s Orix, Credit Saison in merger talks TOKYO (Reuters) – Orix Corp, Japan’s largest leasing company, and credit card firm Credit Saison are in merger talks, financial sources said on Tuesday, in a further sign of consolidation in the country’s hard-pressed consumer lending sector. Combining the two would create a finance group with $106 billion in assets as Japan’s financial sector battles tighter regulations in consumer lending and the global credit crunch, even as a slowing economy has hurt Orix’s core lease business.