Japan’s PE firms on trade sale hunt

According to Thomson Reuters, Japan's cash-rich corporates purchased $44.3 billion worth of assets from private equity firms in 2011, almost six times more than the previous year, and the trend is likely to continue.

"This is an ideal form of exit for investors in private equity funds, because corporate buyers tend to pay higher prices than private equity firms," said Kazushige Kobayashi, managing director for fund-of-funds Capital Dynamics.

Prospective deals on the cards include a disposal of Arysta LifeScience, which Permira bought from Olympus Capital and its co-investors Lehman Brothers and Bank of Tokyo-Mitsubishi UFJ for $2.13 billion in October 2007.

Unison Capital could also look to offload sushi restaurant operator Akindo Sushiro, in which it acquired a minority stake for JPY4.8 billion ($57.9 million) in 2007.

Another factor adding to the corporate appetite for acquisitions is the fact that The Carlyle Group is set to go to market soon, and Tokio Marine Capital, Polaris Capital and Longreach Group are already on the fundraising trail, which should lead to more companies being divested from older vehicles.

Polaris and Tokio Marine have already had drug producer Showa Yakuhin Kako on the block since last September, with Citigroup hired to advise on the process. Japanese dental materials maker GC Corp. is reportedly in the final round of bidding for the business, in collaboration with Unison Capital.

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• Topics
• Exits
• North Asia
• Exit
• Trade sale
• Japan
• Unison Capital
• Polaris Principal Finance
• Tokio Marine Capital
• Capital Dynamics
• Permira Advisers
• Olympus Capital Holdings Asia
• The Longreach Group Limited
• The Carlyle Group