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Unison nears $650m Showa Yakuhin Kako buyout - sources

  • Susannah Birkwood
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Japanese private equity firm Unison Capital is reportedly in the final round of bidding for Showa Yakuhin Kako, a drug producer backed by Tokio Marine Capital.

A sale of Showa Yakuhin Kako, which is 50% owned by Tokio Marine, could reach around JPY50 billion ($650 million), according to four sources cited by Reuters. The firm, in which Polaris Capital Group and the private equity arm of PineBridge Investments also hold 23% stakes, was put on the block last September, with Citigroup hired to advise on the process.

Unison is in cahoots with Japanese dental materials maker GC Corp. over the bid, while a US drugs manufacturer is also said to have expressed an interest.

The current shareholders are hoping to sell Tokyo-based Showa, which manufactures and distributes dental equipment and generic drugs, at around 10x its EBITDA of JPY5 billion. All three backers, led by Tokio Marine, acquired the company and its debt from Japanese venture capital and buyout firm JAFCO for approximately $400 million in 2008. Tokyo-Mitsubishi UFJ provided JPY22 billion worth of financing.

Tokio Marine's other key healthcare asset is Bushu Pharmaceuticals, a provider of drug manufacturing services, which it purchased from listed company Shionogi Pharmaceuticals in March 2010.

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