KKR and Japan Industrial Partners to buy Hitachi Kokusai Electric for $2.3 bn
27 April 2017
US private equity firm KKR & Co has teamed up with investment fund Japan Industrial Partners Inc (JIP) to buy Hitachi Ltd's electronic equipment subsidiary, in a deal valuing the unit at 257 billion yen ($2.3 billion).
The acquisition comes three months after KKR purchased Hitachi's power tools unit, Hitachi Koki Co Ltd, for about $1.3 billion. (See: KKR to buy Hitachi's power tools unit for $1.3 bn)
Under the latest deal, KKR and JIP will pay ¥2,503 for each Hitachi Kokusai Electric Inc share, a 6.4 per cent discount from Wednesday's close.
Upon closing, Hitachi Ltd, the largest shareholder in Hitachi Kokusai, will retain 20-per cent stake in the company.
Hitachi Kokusai is a leading manufacturer of broadcasting systems, security and surveillance systems, wireless communications, information systems, and semiconductor manufacturing equipment.
The Tokyo-based company operates two business segments: a video and communication solutions business engaged in video security, IoT high-reliability wireless, and railroad solutions, and a thin-film process solutions business focusing on semiconductor manufacturing equipment as well as systems maintenance and sales of parts and used equipment.
Hiro Hirano, member of KKR and CEO of KKR Japan, said, "Hitachi Kokusai is a world-class provider of video and communications equipment and semiconductor manufacturing solutions and is part of an industry that is set to benefit from the proliferation of three-dimensional NAND flash memory."
"Hitachi Kokusai's Video and Communication Solutions business has a strong track record of sales of communications and wireless equipment to local municipalities and government agencies in Japan," said, Hidemi Moue, CEO of JIP.