Advent to close Japan with no active investments
After much speculation among industry insiders and reported LP dissatisfaction with the situation, US private equity firm Advent International has finally made public a decision to close its Japan office by the end of this month. The firm came to the decision because it established there were not enough investment opportunities that met their investment requirements and strategy to justify a dedicated Japan fund and office.
The possibility of the closing Advent’s Japan dedicated fund, which raised JPY 60 billion ($723.7 million) in 2008 has been discussed among industry peers for over a year. Around the end of 2010 AVCJ heard from angry limited partners about the fund closing note they received; Advent made no investments, yet has been collecting management fees. When AVCJ asked an Advent spokesperson about the letter and the situation, the person told AVCJ that the fund will look at PIPE and other opportunities in Japan. The style drift came as a shock to LPs who signed up for a buyout fund. At that time, LPs had already begun discussing what to do about commitments to Advent’s Japan fund to minimize losses.
Despite Advent’s lack of deal flow, the Japan market has seen significant recovery in PE transactions, with the $500 million to $1 billion space coming back nicely since the second half of 2009
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