Bain to make full exit from Japan's Bellsystem24

The pricing of the transaction was not disclosed, with Bellsystem24 only saying in a filing that approximately 10.6 million shares would be sold in an off-market transaction. Based on the November 30 closing price of JPY1,392, Bain would receive proceeds of JPY14.7 billion ($131 million).

The private equity firm acquired Bellsystem24 from Citigroup Capital Partners Japan for JPY100 billion (then $1.16 billion) in 2009. It sold a 49.9% stake to Itochu Corporation in 2014 and then listed the business the following year. Bellsystem24 raised JPY48.1 billion through the IPO, which saw Bain reduce its holding from 50.1% to 14.5%, receiving proceeds of JPY36.2 billion.

The company is a customer relationship management (CRM) outsourcing business built on a call center model, with various complementary services including e-commerce support, research and marketing, analytics and information technology.

Having spent two years stabilizing the business, Bain turned its attention to changing Bellsystem24’s operating model from a cost-plus-pricing basis – which meant the customer was paying for an agent who was only answering calls 50% of the time – to a performance-based approach. David Garner, who had experience running CRM businesses in the US, was brought in as chairman to lead this transition.

Bellsystem24 operates 31 call centers with approximately 32,000 agents. Since Itochu’s investment, efforts have been made to leverage the relationship to bring in more business from the conglomerate’s subsidiaries. The company is now seeking a similar strategic arrangement with Toppan.

The new shareholder has 11 centers providing business process outsourcing (BPO) services. Toppan will combine its customer base, technical ability and business know-how with that of Bellsystem24, contributing to the latter’s desire to strengthen its BPO offering with new technology.

Bellsystem24 posted revenue of JPY108.9 billion for the 12 months ended February 2017, up from JPY102.5 billion the previous year. Net profit fell from JPY5 billion to JPY4.3 billion over the same period.

This will be Bain’s second Japan exit in the space of about a week, following a decision to divest its remaining 15% stake in restaurant operator Skylark. The private equity firm acquired the business in 2011, took it public three years later, and has made several partial exits since then.

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• Topics
• North Asia
• Open market
• Technology
• Support services
• Japan
• Bain Capital Asia
• Exit