KKR leads race for Panasonic healthcare unit - report

According to Nikkei, KKR has obtained preferential negotiating rights for the business, which makes blood sugar monitoring equipment and electronic medical record-keeping systems.

An agreement is expected to be reached by the end of this month. Toshiba Corp. and a consortium including Bain Capital, Mitsui & Co and the Development Bank of Japan (DBJ) were also said to have been in the running for the unit.

In the financial year ended March, Panasonic's healthcare business made JPY8.7 billion ($87 million) in operating income on JPY134.3 billion in sales, giving it an operating profit margin of 6.5%.

Its parent company, meanwhile, posted combined losses of $15 billion over the last two financial years, prompting the electronics giant to launch a vast restructuring effort. This has included selling off non-core assets and Advantage Partners was one of the first to capitalize by acquiring the digital camera business of Panasonic unit Sanyo Electric last December.

With the recent close of its $6 billon Asia fund - the biggest ever in the region - KKR has made clear its interest in investing in restructuring Japanese corporates, having recently hired turnaround specialist Hirofumi Hirano as CEO of its Japan operations.

Last year, KKR had tried to buy a controlling stake in Japanese chip maker Renesas Electronics but lost out to a consortium led by the state-backed Innovation Network Corp of Japan (INCJ).

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• Topics
• North Asia
• Restructuring
• Buyouts
• Technology
• KKR
• Advantage Partners
• Innovation Network Corp. of Japan (INCJ)
• Bain Capital Asia
• Japan
• buyout
• Technology