J-Star acquires Japan auto parts company

J-Star invested via its third fund, which closed at JPY32.5 billion ($292 million) last year. The GP typically takes control or co-control positions in companies with valuations of JPY3-10 billion, writing checks in a range of JPY1-3 billion.

The plan is to expand the company through bolt-ons, which will increase the utilization rate of a factory in Vietnam and improve earnings. J-Star noted that the Japanese market for rebuilt auto parts was supported by the repair and maintenance market, which itself was growing on the back of sluggish new car sales.

“We believe Honest is one of the major players in the heavily fragmented rebuild auto parts market,” Greg Hara, CEO and managing partner at J-Star, told AVCJ. “Although sales are not significant in size, Honest maintains a double-digit EBITDA margin.”

Founded in 1993, Honest aims to leverage an increasing focus on recycling in the auto industry by supplying branded remanufactured components for used car repair. It notes that while rebuilt parts have achieved widespread use in Europe and North America, the Japanese market was still developing.  

J-Star has used a similar platform-based approach to pursue consolidation plays in various segments, including aged care clinics and veterinary services. Previous activity in the auto supply segment includes the acquisition of plastic parts manufacturer Kugami for about $30 million.

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• Topics
• North Asia
• Industrials
• Buyouts
• Japan
• J-Star
• automobiles
• manufacturing