Global private equity firm Bain Capital has listed Japan-based portfolio company Skylark on the Tokyo Stock Exchange, raising JPY 66.8 billion ($618 million; €485 million) and exiting around one-third of its stake.
Skylark listed at JPY 1200, raising $618 million, although had previously hoped to bring in $700 million for the business.
Bain closed the $2.1 billion buyout of Skylark, a Japanese restaurant chain known for its family-style brands Jonathan’s and Gusto, in 2011, and has now reduced its stake to 66 percent from 97.7 percent. The firm did not disclose return information on the deal, but a source close to the matter said it was a “strong return”, with the firm “pleased with how things have gone”.
Bain retains its majority position intending to continue the operational work it started in the business.
Over the course of its ownership, Bain helped Skylark recruit new management with global expertise to work alongside existing management. It found executives from McDonalds, Starbucks and Uniqlo to join the firm and introduce international best practices learned in other consumer retail businesses from across the globe, while maintaining a predominantly Japanese culture.
Bain improved the company’s profitability and top-line revenue growth, as well as implementing a sophisticated data and analytics platform to help in decision-making around operations such as pricing, menus, marketing and locations. The firm expects to further grow the company’s presence by 30 restaurants within Japan by year-end.
Post-IPO, Bain expects to continue improving the company’s operations in areas including store efficiencies, customer experience and shortened queue times.
Bain has been one of foreign private equity’s biggest success stories in Japan, having closed a number of large buyout deals in the country, which are rare and sought-after.
It is also demonstrating its ability to generate exits, as well as do deals, having sold 49.9 percent of Japanese portfolio company Bellsystem24 to domestic trade buyer ITOCHU Corporation for an undisclosed sum in July this year, Private Equity International reported earlier.
In August last year, the firm also successfully exited its investment in Domino’s Pizza Japan in a $123 million deal, selling a 75 percent stake of the business to Domino’s Australia.
Bain Capital was founded by former US presidential candidate Mitt Romney and currently has about $75 billion in assets under management. Bain Capital Asia, the firm's Asian private equity affiliate, established a presence in the region in 2005 and includes businesses such as MYOB, ASIMCO, Feixiang, GA Pack, GOME, Hero Investments and Jupiter Shop Channel among its portfolio.