Japan's Marunouchi Capital hits $303m first close on Fund III
Marunouchi Capital, a Japanese private equity firm controlled by Mitsubishi Corporation, has reached a first close of JPY 40.2bn (USD 303m) on its third fund.
Mitsubishi and unnamed third-party LPs made contributions to the first close. The overall target is JPY 100bn. Marunouchi raised JPY 100bn for its first fund in 2008, with Mitsubishi and MUFG Bank accounting for at least 45% of the corpus. Fund II closed on JPY 94.2bn in 2018 – short of the JPY 100bn target. Mitsubishi and MUFG put in JPY 25bn apiece.
Marunouchi is described as a corporate-investment fund manager that specialises in business successions and carve-outs from large conglomerates. It claims to add differentiated value by leveraging Mitsubishi’s credibility and business network.
“Due to management-related challenges caused by a lack of successors, impacts from the COVID-19 pandemic and other factors, demand for business succession remains high in Japan. In recent years, there has also been a rise in the number of divestments of non-core businesses and subsidiaries from listed companies,” Mitsubishi said in a statement.
“Through Fund III, Marunouchi Capital plans to leverage both the expertise gained through its first two funds and [Mitsubishi’s] comprehensive strength to assist economic growth in Japan by boosting the value of its portfolio companies and stimulating industry.”
Fund I made four investments: supermarket chain Seijo Ishii, home improvement retailer Joyful Honda, toymaker Takara Tomy, and automotive parts supplier Yamamoto Seisakusho. Seijo Ishii was sold to Lawson for JPY 55bn in 2014, while Takara Tomy was exited in 2015 through the open market, and Joyful Honda was sold to Baring Private Equity Asia – now BPEA EQT – in 2016.
The Fund II portfolio comprises wholesaler Akomeya Tokyo, industrial manufacturers Moji Metal Products, KMCT Corporation, Sambo Piping, and Tris, mushroom supplier Misuzu Life, grocery store operator Miuraya, commercial cleaning equipment maker Tosei Corporation, design products retailer Graniph, food services business Cypress, and sales and marketing agency Beeats.
Two more businesses are marked as exited on Marunouchi’s website: pet products supplier Daiki and IM FoodStyle, operator of the supermarket chain Queen’s Isetan. The former was sold to Daio Paper Corporation last year.
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