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Last Trade - 14/05/21

Large Cap
Market Cap £18.44bn
Enterprise Value £17.66bn
Revenue £43.56bn
Position in Universe 50th / 3904

Carve-out deals by tech firms 'just tip of the iceberg' - Carlyle Japan chief

Tue 16th March, 2021 4:59am
By Makiko Yamazaki and Yuki Nitta
    TOKYO, March 16 (Reuters) - Recent carve-out deals by tech
giants such as Hitachi Ltd  6501.T  are just the beginning of
potential divestitures of non-core assets by Japanese firms,
U.S. buyout firm Carlyle Group's  CG.O  Japan chief said.
    The comments come as Carlyle recently successfully exited
one of its own investments and sees plenty of opportunities for
private equity firms in the horizon in Japan.
    "These are just the tip of the iceberg," said Kazuhiro
Yamada in an interview with Reuters, referring to a flurry of
recent non-core asset sales by Hitachi, Panasonic Corp  6752.T ,
and Toshiba Corp  6502.T .
    "There are still a substantial number of firms with hundreds
of subsidiaries in Japan, and these firms are considering
various options."
    The bullish outlook for deal-making in Japan followed
Carlyle's complete exit from its investment in Japanese data and
software company WingArc1st  4432.T  through a 19.4 billion yen
($178 million) initial public offering.*:nL1N2KO0QJ 
    WingArc1st, which Carlyle acquired from Japan's Orix Corp
 8591.T  in 2016 for an undisclosed sum, debuted on the Tokyo
Stock Exchange on Tuesday.
    WingArc1st marks Carlyle's eighth IPO in Japan, the highest
among global equity funds operating in the country, Yamada said,
adding that nearly half of the buyout firm's 18 full exits to
date have been through IPOs.
    In the same interview, Hiroyuki Uchino, founder and chairman
of WingArc1st, said he tapped Carlyle five years ago due to its
best IPO track records. Carlyle "has allowed to make investments
necessary to continue growth even after the IPO," he said.
    Yamada said Carlyle sees a number of potential acquisition
targets like WingArc1st that are strong in global niche markets,
or small specialised parts of the global market.
    Earlier this year, Carlyle announced the acquisition of
another such company, Rigaku Corp, an X-ray-based testing tools
manufacturer aiming to go public.
    The deal represents the first investment of Carlyle's new
Japan-focused buyout fund worth 258 billion yen ($2.5 billion),
its fourth and biggest to date in the country.
    "We will probably make two or three more deals this year (by
the new fund)," Yamada said.
($1 = 109.1700 yen)

 (Reporting by Makiko Yamazaki and Yuki Nitta; Additional
reporting by Takashi Umekawa; Editing by Ana Nicolaci da Costa)
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