Baring Asia to exit Japan's Joyful Honda

Baring, which is the largest shareholder in Joyful Honda, will exit approximately 16.2 million shares – a 31.43% interest – for JPY3,497 apiece, an 8% discount to the June 7 closing price. The entire tender offer is for 16.3 million shares, according to a filing. The company’s stock fell 7.60% on June 9 to JPY3,465.

The private equity firm acquired its stake in Joyful Honda from Marunouchi Capital in March 2016, paying JPY38.9 billion (then $350 million). Joyful Honda said that Baring had contributed to its development strategy and corporate governance. The company added that the tender offer would allow it to implement flexible capital policies in response to a changing economic environment.

Founded in 1975, Joyful Honda has four main verticals: Honda Sangyo, which operates arts and crafts stores; Smile Honda, a home renovation materials supplier; Joyful Athletic Club, which runs sports clubs; and Joyful Shaken & Tire Center, a vehicle inspection and servicing business. The company operates 15 stores, typically out-of-town campuses where the different retail brands sit side by side.

Sales came to JPY158.7 billion for the 12 months ended June 2016, down 2.2% year-on-year. Net profit rose 19.6% over the same period to JPY5.45 billion. The company projects sales and net profit of JPY163.2 billion and JPY6.2 billion, respectively, for 2017.

Baring, which has total committed capital of more than $10 billion, opened its Japan office in 2006. The firm has one remaining active investment in the country – Bushu Pharmaceuticals, which was bought from Tokio Marine Capital in 2014.

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• Topics
• North Asia
• Buyback
• Consumer
• Japan
• Baring Private Equity Asia
• Exit