Carlyle re-lists Japanese medical administration business

The New York-headquartered firm originally acquired Solasto Corporation in 2012.

The Carlyle Group has re-listed medical administration provider Solasto Corporation on the Tokyo Stock Exchange, in a transaction that will see the firm sell a maximum of 40 percent of Solasto’s shares, the firm said in a statement. Carlyle will retain a 10 percent stake in the company following the re-listing.

Carlyle Japan’s managing director Takaomi Tomioka will also remain as a board member of the company.

The firm did not disclose returns of its partial exit from Solasto.

The firm took the company private in February 2012 through Carlyle Japan Partners II, a 2006-vintage vehicle that raised JPY 165.6 billon ($1.5billion; €1.4 billion), having initially targeted JPY 100 billion.

Known investors in the fund are the California Public Employees’ Retirement System (CalPERS), Caisse de dépôt et placement du Québec and the China Development Industrial Bank, according to PEI Research & Analytics.

According to CalPERS’ latest fund performance review, the fund has generated an investment multiple of 0.9x and an internal rate of return of -1.3 percent. Carlyle has exited only a third of its nine investments in the fund, according to its website.

Under the firm’s ownership, Solasto’s EBITDA margin expanded from 7.1 percent in FY 2012-2013 to 9.7 percent in March 2016. Carlyle worked with Solasto to accelerate the expansion of its long-term care business, enhance its management team and improve productivity. The company had also acquired elderly housing business Cocoticare, doubling sales from JPY 5.6 billion in FY2012-2013 to JPY 11.6 billion at the end of March 2016. Solasto’s return on equity had also jumped from 1.3 percent to 23.4 percent in the same period.

Established in 1965, Solasto is Japan’s first medical administration outsourcing provider. The company provides long-term care services for the elderly in Tokyo, Kansai and Nagoya areas, childcare services and career centres for medical administration service workers and caregivers.

Carlyle manages $178 billion of assets across 125 funds and 164 fund of funds vehicles.
In September 2015, the firm had raised JPY 119.5 billion for its third Japanese buyout fund, Carlyle Japan Partners III. The fund has made investments across financial services, consumer & retail and healthcare companies.