Advantage exits Japan dental supplier to local strategic

Tokyo-listed Askul is set to acquire an 85% stake on February 28. The size of the pending transaction has not been disclosed.

Advantage carved out 100% of Dental Holding from manufacturing company Noritsu Koki for an undisclosed sum in September 2020 via its sixth buyout fund, which closed on JPY 85bn (then USD 790m) earlier that year. This is the first exit from Fund VI.

Dental Holding recorded sales of JPY 10bn and a net profit of JPY 402m for the year ending March 2020. Sales increased to JJPY 12.5bn as of fiscal 2022, although net profit reversed to negative JPY 453m. Askul said in a filing that it expects 2023 sales and profit to be on par with 2022.

Operations during the holding period were most notably marked by COVID-19, which increased demand for sanitary products. Financial support from the government in response to the effects of the pandemic was also said to have underpinned earnings growth. While demand diminished in 2022, the customer base expanded.

Importantly, the pandemic increased demand for wholesale distribution channels that do not require face-to-face contact. Dental Holding’s mail-order business, Feed, was highlighted as a key asset at the time of Advantage’s acquisition.

Launched in 1987, Feed, which also supplies pharmaceuticals and other medical products, is touted as the first mail-order catalogue for dental clinics in Japan. Its specific operating and financial results as a subsidiary were not disclosed.

Strategic M&A is expected to dominate Japan exits in the coming years despite green shoots in a long-dormant IPO market. Shinichiro Kita, a senior partner at Advantage who led the Dental Holding acquisition, predicted more exits via secondaries and GP-to-GP transactions in 2023.

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

• Topics
• North Asia
• Support services
• Healthcare
• Trade sale
• Japan
• Advantage Partners
• Logistics