Detailed Description of Portfolio Companies of Fund IV
HITOWA Holdings Co., Ltd.
| Features | Since its establishment in 1997, the company have developed its 3 main businesses; 1) Franchising business of various services including “Oso-ji Hompo” to deliver housecleaning service and “KEiROW” to provide visiting rehabilitation massage care, 2) Nursing care service business to operate nursing homes of the elderly named “Irise”, and 3) Child care support service business to operate licensed kindergartens named “Taiyo no ko”. Additionally, it also operates 1) Human resource services business focusing on staffing in nursing and child care fields, and 2) Food service business to cater to elderly homes, kindergartens and corporate cafeterias, etc. across Japan, as complementary to the main businesses. |
|---|---|
| Investment Pattern | Business Succession Secondary Buyout |
| Investment Theme | Polaris intends to achieve HITOWA’s continued growth and reinforce its strength by acquiring more franchisees of FC business, the biggest growth driver, increasing per-FC sales through improving repeating customer ratio via proactive marketing and developing new peripheral businesses as well as a new pricing strategy in nursing care segment where market growth is expected, in a collaboration with Polaris’s existing investment companies where possible. In preparation for initial public offering, Polaris also plans to strengthen HITOWA’s corporate governance through dispatching of directors and officers. |
| Date of Exit | January 2024 |
| Exit Pattern | Trade sale of the entire holdings to an SPC owned by an investment fund managed by MBK Partners |
| Exit Story | Post-investment, in addition to deploying several management talents, Polaris strengthened the company’s KPI monitoring to expand the scale and improve the operational efficiency of its franchisees, nursing homes and childcare facilities, as well as restructured the business portfolio by exiting the staffing business. Moreover, while working to strengthen its governance, the company achieved steady business growth and established a solid position in each of its businesses as a result of digital transformation（“DX”） initiatives, such as strengthening CRM and developing platform businesses. After the sale to MBK Partners, which has experience in multi-store consumer businesses, including senior and franchise businesses, we believe HITOWA Group will further enhance its corporate value while following its existing growth strategy as a company which helps to resolve social issues. |
