JAPAN Trends and Developments Contributed by: Shuichi Nishimura, Yasuhiro Kasahara and Yoshitaka Kato, Nagashima Ohno & Tsunematsu
Nagashima Ohno & Tsunematsu JP Tower 2-7-2 Marunouchi Chiyoda-ku Tokyo 100-7036 Japan
Tel: +81 3 6889 7000 Fax: +81 3 6889 8000 Email: yasuhiro_kasahara@noandt.com Web: www.noandt.com
Investment Deal Trends The private equity market in Japan continued to be very active in 2024. While there is no official data on the number or type of transactions conducted by private equity firms, it is reported that a historically high number of private equity deals occurred in 2024. Since around 2015, the increase in private equity deals has mainly been driven by the expanding need to find successors for small to mid-size business own - ers. Recently, however, private equity deals are show - ing more diversity, such as carve-out deals, taking- private deals, including MBOs, and secondary buyout deals. This is strong evidence that private equity firms are now recognised in the Japanese market and are expanding their role in Japan. Notable deals from 2024 include the following: • the acquisition of Infocom Corporation by Black - stone in November 2024 for approximately JPY244 billion (going-private); • the acquisition of Outsourcing Inc. by Bain Capital in Aprile 2024 for approximately JPY189 billion (going-private); • the acquisition of Japan KFC Holdings Co., Ltd. by Carlyle in July 2024 for approximately JPY114 bil - lion (going-private); • the acquisition of Benesse Holdings Inc. by EQT in March 2024 for approximately JPY176 billion (going-private); • the acquisition of the automotive system business operated by Panasonic Corporation by Apollo Global Management in December 2024 (carve-out deal);
• the acquisition of the orthopaedic business oper - ated by Olympus Corporation by Polaris Capital Group in July 20243 (carve-out deal); and • the acquisition of Sony Payment Services Inc. by Blackstone from Sony Bank Inc. in January 2024 (carve-out deal). It is notable that 11 carve-out deals in which private equity funds acquired certain business from Japanese companies were closed in 2024, which is at a higher level than the past years. This is being driven by the need for major Japanese companies to divest unprof - itable or non-core businesses in order to concentrate on their core business. It is expected that these trends will continue in the coming years. The secondary market and public-to-private transactions The number of public-to-private (P2P) deals sharply increased in 2024 compared with the previous year. Around 30 P2P deals were closed in 2024, which is approximately twice the number in the year before. In recent years, activist shareholders have been active in the Japanese market, and there have been some deals in which private equity funds acquired listed companies having problems with activist shareholders as a kind of a “white knight”. Bain Capital’s acquisition of T&K Toka Co., Ltd., which faced a hostile takeover by Dalton Group, is a good example of such a deal. The number of unsolicited offer deals (these were called hostile takeovers in the past but now are renamed as unsolicited offers, taking into account that unsolicited offers can turn into friendly deals by
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