Bain Capital Partners has agreed to pay approximately ¥47.7 billion ($444 million; €286 million) for D&M Holdings, a Japanese company that provides management and distribution for audio and video brands including Denon, Marantz and Boston Acoustics.
Boston-based Bain will launch a tender offer for all shares of D&M at a price of ¥510 per share. The agreed share price represents a 37.1 percent premium over the average closing share price in the six months prior to 19 June. Upon the completion of the tender offer process, D&M will be delisted from the Tokyo stock exchange.
In a separate agreement, the company’s largest shareholder, RHJ International, has agreed to sell its 48.5 percent stake to Bain.
RHJ, previously called RHJ Industrial Partners, is a Brussels Euronext-listed affiliate of US buyout firm Ripplewood Holdings.
Ripplewood is well-known for leading a consortium with JC Flowers that in 2000 acquired the troubled Long-Term Credit Bank of Japan in a $1.2 billion deal. Renamed Shinsei Bank, the company was listed in 2004 after a drastic turnaround. It is widely viewed as one of the most lucrative private equity deals ever, and remains the most successful Japanese buyout to date.
When investing in global companies, Bain typically draws capital from both its regional and global funds, said a source close to the firm. The firm will likely invest capital from both its $1 billion Asia fund as well as its global funds, the most recent of which closed in 2006 on $8 billion, and was supplemented by a $2 billion co-investment fund. The firm is currently raising its 10th global fund, targeting $10 billion as well as a $5 billion co-investment fund.
Bain is a multi-strategy private investment firm with more than $78 billion in capital under management. The firm’s previous investments in Japan include payment systems company MEI/Conlux and communications equipment company Sun Telephone.