KDDI to buy Biglobe from Japan Industrial Partners

KDDI, a domestic telecom provider that offers voice and data services including broadband internet, said in a filing that it expects the deal to close in January, after which Biglobe will become a wholly-owned subsidiary. JIP overcame rival bidders such as Itochu Corp. and Japan Rising Equity to acquire the company in January 2014 for an undisclosed sum.

Biglobe operates a fixed-line internet service with more than two million subscribers as of September. It also had approximately 400,000 mobile customers. The company has 467 employees and generated revenue of JPY77.6 billion for the 12 months ended March 2016. Reports at the time of the sale to JIP put 2012 revenue at JPY84.1 billion.

KDDI has benefited from the proliferation of smart phone use in Japan while smaller internet service providers have struggled. KDDI had around 39 million mobile subscribers as of September and 9.04 million fixed-line subscribers. The company is also moving into complementary areas such as electronic payment services. Revenue reached JPY4.46 trillion in 2016, while net income came to JPY818.4 billion.

"With this conversion into a subsidiary, KDDI and Biglobe will utilize their respective customer bases, business expertise, and so forth to expand business through synergies between the two companies, not only in the telecommunications domain, but also in non-telecommunications domains such as settlement services and product sales business," the filing said.

JIP invested in Biglobe through its fourth fund, which closed at JPY67.4 billion in March 2013. The GP specializes in carve-outs and restructurings of large and mid-size enterprises.

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• Topics
• North Asia
• Trade sale
• Technology
• Japan
• Japan Industrial Partners
• Exit