Polaris exits Japanese timber company

The acquisition price was confirmed in a filing by the buyer, Yamae Hisano, a company that specializes in wholesaling packaged foods but which also has some operations in construction supplies and timber processing. The transaction is set for completion by the end of March.

Polaris acquired Hivic in mid-2016 from local construction group Lixil via its third fund, which closed in 2013 at JPY39.1 billion. The deal was worth about $69 million, according to AVCJ Research. The private equity firm said in a statement that the company had demonstrated “steady business growth despite fast-changing business environment” during the holding period.

Recent value-add measures include opening new branches in Japan’s Kanto region, which includes Greater Tokyo, and expanding operations in the non-home segment of the timber business. Steps were also taken to strengthen direct relationships with clients by eliminating middlemen such as construction material trading houses and sales agents.

At the time of Polaris’ acquisition, Hivic recorded annual sales of JPY20.3 billion and net profit of JPY501 million. Revenue for the year ended March 2018 came to JPY20.4 billion, up from JPY10.2 billion the prior year. Net profit during the same period came to JPY570 million compared to a loss of JPY241 million the year before.

Earlier this month, Polaris acquired cleaning, assisted living and childcare services company Hitowa Holdings from CVC Capital Partners. The deal was reportedly worth more than JPY50 billion, which would represent a significant step up in target size for the firm. Polaris closed its fourth fund at JPY75 billion in 2017.

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• Topics
• North Asia
• Industrials
• Trade sale
• Japan
• Polaris Capital
• Exit
• manufacturing