Unison leads MBO of Japanese wine importer
Japanese buyout firm Unison Capital will spend JPY6.2 billion ($75.4 million) to privatize publicly listed Japanese wine importer and retailer Enoteca Co. through an MBO alongside H.C.B.C. Enterprises Ltd., an investment firm headed by George Joseph Ho, who is also on the wine company’s Board. Enoteca debuted on the Nippon New Market (Hercules) of the Osaka Stock Exchange in 2006 and was listed on Tokyo Stock Exchange two years later.
Enoteca was established in 1988 by Yasuhisa Hirose, who is still the CEO of the company. The company is a wine importer, distributor and retailer, as well as running cafés. It operates 34 outlets in Japan and two overseas shops.
As part of the deal, H.C.B.C. will take a 20.51% stake in the buyout vehicle that Unison manages. Unison will pay JPY120,000 ($1,437) per share - a 46% premium over the company's February 2nd closing price. According to the company statement, founder Hirose, who holds a 27.87% stake and will remain President, has agreed to sell all of his shares to Unison Capital. VC firm Jafco Co. owns a 3.81% stake already. Foreign lenders including Morgan Stanley, Credit Suisse and HSBC will provide financing for the deal.
The TOB will end on March 17. Nishimura & Asahi has been serving as legal advisor while Ernst & Young is the financial advisor.
A spokeswoman at Unison Capital told AVCJ that the firm entered into discussion about mid and long-term plans for Enoteca in October last year and decided to launch an MBO to develop the company more quickly. She said that the firm had not met Hirose before discussing this opportunities with Enoteca.
The recent surge of high-end wine prices has put pressure on the company's profitability, while Chinese consumer's strong demand for French wines opted the wine importer to expand into nearby Asian markets with the support of Unison. CLSA's report noted that with an estimated growth rate of 23%, China will become the world's largest domestic market for luxury goods, worth Euro74 billion ($103 billion) or 0.6% of the country's total GDP over the next 10 years.
In 2009, it has opened a much-touted flagship wine store in Hiroo, an upmarket urban residential area in Tokyo. The company sells around 1,000 different wines imported from France, Italy, Spain and Portugal and other countries through retail, wholesale and online outlets. It sells to large retailers like Seibu, Mitsukoshi and Isetan. The company has also operates a wine boutique named Les Caves Taillevent under a domestic license from Restaurant Taillevent in Paris.
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