Bain completes tender offer for Japan’s ADK

According to a filing, 36 million shares in ADK, representing an 87% stake, were tendered to Bain for JPY3,660 each. After acquiring the company, Bain plans to delist it and proceed with significant changes to its business model. The financial and strategic flexibility provided by privatization is seen as essential to these efforts.

Bain launched its offer in October, setting a minimum acceptance level of 50.1%. The deal initially faced opposition from London-based WPP Group, ADK’s largest shareholder, which said the proposal significantly undervalued ADK. WPP also accused ADK of ignoring its suggestions for restructuring the business and failing to take advantage of numerous opportunities for improvement.

In accordance with their agreement, ADK has asked WPP to sell its 24.9% stake to Bain at the PE firm’s offer price. Though WPP requested an injunction and arbitration to prevent the enforcement of this request, it later agreed to accept Bain’s price and said it would drop the legal challenge if the offer was accepted.

ADK is Japan’s third-largest advertising agency by market share, with clients across multiple sectors. According to its most recent annual report, the company recorded revenue of JPY353 billion for the year ended December 2016, up from JPY352 billion in 2015. Over the same period, net profit fell from JPY5.6 billion to JPY2.6 billion.

Bain is an active investor in Japan, having headed a consortium that recently agreed to purchase the Nand flash memory unit of Toshiba Corporation for JPY2 trillion. In the past three weeks, it has also completed exits from restaurant operator Skylark and call center business Bellsystem24.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• North Asia
• Technology
• Media
• Buyouts
• Japan
• Bain Capital Asia
• TMT