Investment Policies

Main Concept/
Target Companies
  • Main Concept: Revival of Venture Spirit and Promotion of Business Model Innovation for Revitalizing of Japanese economy
  • Target Companies: Japanese mid-cap companies for the opportunities of Business Successions, Carve-outs/Spin-offs and Recapitalization.
  • More specifically, companies in (1) Manufacturing with technologies/patents competitive in the global market and (2) Consumer Goods/Retail/Logistics/Services with strong brands or unique business models which have potential to expand into the Asian markets.
  • Leveraged Buyout: Leveraged financing to be actively used
  • Excluded from our target list: Real estates, Financial Services, Distressed Assets, Ventures and PIPEs.
Deal Pattern
  • Purchase of the original owner’s shares for Business Succession
  • Carve-out/Spin-off of non-core business/subsidiary of large conglomerate
  • Going-private transaction for realignment of ownership structure/restructuring of business strategies
  • Purchase of the shares owned by a financial investor including other PE fund
Ownership
Percentage
  • In principle, a majority of voting rights (preferably more than 2/3) is a must
  • A minority of voting rights (about 1/3) can be considered if sufficient control on governance and exit strategies are secured through Agreement among Shareholders.
Target Sectors
  • Diversify the portfolio into the 3 categories below:
    • Category Ⅰ : Technologies, Manufacturing, Medical-related
    • Category Ⅱ : Consumer Goods, Retail, Restaurant
    • Category Ⅲ : IT, Services, Logistics
Size of
Target Company
  • A corporation or a business division with Enterprise Value of JPY10 billion to JPY50 billion.
Size of
Equity Investment
  • Number of Investments: About 12 investments per fund for portfolio diversification purpose.
  • Equity Amount per Investment: not less than JPY 3 billion, target between JPY 5 - 9 billion, and not more than 15% of the aggregate Capital commitments of the fund.
  • Co-investment with strategic and/or financial investors to be arranged for large-sized deals.
Post-Investment
Monitoring
  • Hands-on Involvement in monitoring and value creation effort to maximize the value of the portfolio companies.
    • Send in outside directors to work with the existing management of the portfolio company for implementing stronger corporate governance and more effective business strategies.
    • Dispatch investment officer on a full time basis for the “First 100 days” to jump start the value creation process if required depending upon the portfolio company’s situation.
Exit Strategy
  • Exit within 3 to 5 years via trade sale to strategic/financial buyers or IPO.
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