Permira-owned Sushiro targets $728m Japan IPO

The company plans to sell 19.1 million shares – rising to 21.1 million if the overallotment option is fully exercised – at an indicative price of JPY3,900 apiece, according to a filing. This equates to a valuation of JPY107 billion for the company as a whole. It is scheduled to begin trading on March 30.

Permira intends to offload 18.9 million shares in the offering, generating proceeds of JPY73.7 billion and taking its stake from 94.7% to 30.9%. It bought Sushiro from Unison Capital in 2012 at a valuation of approximately EUR895 million ($946 million), including debt, or just above 8x EBITDA.

Unison acquired the business between 2007 and 2008 for around JPY18 billion, culminating in a de-listing. The Japanese GP claimed to increase store numbers, sales and EBITDA by 50%, 75% and 150%, respectively, during the holding period. For the year ended September 2011, sales reached JPY99.8 billion, compared to JPY59 billion in 2007. EBITDA came to JPY8.8 billion in 2011.

At the time of Permira’s acquisition, Sushiro had 335 restaurants in Japan and had just entered Korea. The private equity firm saw the opportunity for further growth, saying in its 2012 annual report that the number of restaurants in Japan alone could at least double, with plans to open around 30 new outlets a year.

Sushiro is the one of the market leaders in the revolving sushi restaurant space, offering food of consistently high quality at a lower price point compared to traditional sushi establishments. As of September 2016, the company had 442 restaurants in Japan and six in Korea. It expanded into the US last year.

Annual revenue reached JPY147.7 billion in 2016, up from JPY136.2 billion in 2015, while EBITDA increased to JPY12.3 billion from JPY10.8 billion over the same period. Net profit fell to JPY3.2 billion from JPY3.9 billion in 2015.

Sushiro was Permira’s second investment in Japan after agricultural chemicals maker Arysta LifeSciences, which was sold to Platform Specialty Products for about $3.51 billion in 2014. Last year, the firm bought a controlling stake in John Masters Organics, owner of the eponymous personal care brand and its exclusive distributor in Japan and East Asia, for an enterprise valuation of JPY37 billion.

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• Topics
• North Asia
• IPO
• Consumer
• Japan
• Permira Advisers
• Exit