EQT plans to build a private equity investment team in its newly launched Japan office.
Simon Griffiths, the firm’s head of private equity Asia-Pacific, told Private Equity International that it expects to base five to six investment professionals in Tokyo. The team will comprise existing EQT executives and several local Japanese hires.
EQT established its Tokyo office on 29 January, according to a statement.
“We’re in the process now of recruiting a team and we’ve already allocated some people internally who are working with Japan,” Griffiths said. “We start to see that the market is opening, so we’ve just decided to push ahead. Private equity will spearhead it, but I suspect my private equity colleagues will be joined by others quite soon.”
EQT has partnered with Japan Industrial Partners, a Tokyo-based private equity firm, to help source investment opportunities, the statement said. JIP has ¥170 billion ($1.6 billion; €1.3 billion) of assets under management across five private equity funds, according to PEI data.
“There is no obligation for us to invest together,” Griffiths noted. “We’ll both be free to continue to do investments independently, should we both choose.
“But we do think there’s an awful lot where we can bring the strength of two firms together that will really help us win – not only win investments, but also help the companies that we invest in.”
EQT’s Japan plans were first announced in its 2019 IPO prospectus, which said the firm was evaluating whether to launch a larger Asia-Pacific vehicle in 2021 or 2022. EQT manages three mid-market Asia funds, the most recent of which – the 2016-vintage EQT Mid Market Asia III – collected $737 million, per PEI data. It has yet to invest in Japan.
“We’ll be able to do large transactions as we do in the rest of the world now,” Griffiths said. “But we recognise that a lot of the dealflow in Asia is still what I’d call the upper mid-market.
“Since EQT started in China and then South-East Asia, we’ve mainly focused on deals in the sort of $50 million to $100 million equity ticket range, and what we’ll do now is focus on deals of at least $100 million and above.”
EQT had raised €14.6 billion by the end of last year for its ninth flagship fund. Griffiths declined to comment on fundraising.
Griffiths, who will operate from Singapore, rejoined EQT last year, the statement said. He originally joined the firm’s Hong Kong office from Bain & Company in 2008 before helping to launch its South-East Asia business in Singapore. He reportedly joined Swedish fashion brand Filippa K as chairman in 2017.
EQT joins a growing band of global firms expanding into Japan. Apollo Global Management and Pantheon both launched offices in 2018. The Carlyle Group – which has been in the country for around two decades – KKR and Blackstone have also been staffing up their existing deal and advisory teams in Japan.
“I’m very confident that we can find our niche,” Griffiths said. “We’re going to stay there and we’ll do whatever we can to build the business in Japan. And if it takes longer than we’d like, then so be it. But we have absolutely every intention to stay and be successful.”