J-Star exits Japanese candy maker(2)

The Japan-based mid-cap buyout firm has sold its shares in branded sweets manufacturer Tokachi to a corporate buyer, gaining an exit multiple of 1.3x.

Tokyo-based J-Star has exited its stake in confectionery Tokachi in a sale to publicly-listed Mediaflag, according to a statement from J-Star.

The exit multiple, according to a source with knowledge of the deal, was 1.3x.

J-Star declined to comment.

The original agreement was signed last month and valued the deal at roughly ¥640 million (€4.76 million; $6.5 million), according to a public filing in Japan. J-Star together with its offshore parallel vehicle Pacific Fund Management, held 100 percent of Tokachi.

Tokachi, which reported sales of ¥1.52 billion and net income of ¥70.92 million,  manufactures and sells branded Japanese sweets across 35 stores in Japan. J-Star acquired the company in 2007 from the founder, Iwao Takahashi.
The buyer, Mediaflag, is a provider of sales support and mystery shopping services for consumer goods companies and is listed on the Tokyo Stock Exchange.
“After careful consideration, we came to a conclusion that synergy between Mediaflag's operational/marketing knowledge and the brand power of Tokachi & Tachibana will help expansion of their product mix and further enhance Tokachi's value,” J-Star said in the statement.

In July, J-Star made a final close on its second private equity vehicle on its hard cap of approximately $205 million (¥20 billion), Private Equity International reported earlier. 

J-Star is a Tokyo-based small and mid-cap buyout firm. It focuses on companies with an enterprise value of ¥3 billion to ¥10 billion. Since its founding in 2006, J-Star has made 17 investments in various industries such as consumer goods, e-commerce, healthcare, environment, and manufacturing, according to the firm.