Japanese small-cap private equity firm J-Star has invested JPY 1 billion (€7.7 million; $10 million) in Tokai Trim Holdings, a domestic car and motorcycle seat manufacturer, according to a company statement.
The acquisition was a co-investment with the Supply Chain Support Fund, a joint vehicle launched by Japan Auto Parts Industries Association and the Development Bank of Japan. The deal is the first from the fund.
Tokai Trim has already expanded into China, Vietnam and Thailand, and will use J-Star’s investment to fund further international growth.
“While the profitability of the business has been stable, the company's growth strategy to expand its overseas business (mainly in ASEAN) was held back due to [losses incurred] during the [holding period] of the founding owner,” the statement said.
With our involvement through investment, the financial grounding of Tokai Trim Group will be strengthened, which will enable them to further establish overseas operations
A statement from Japan country manager J-Star
“With our involvement through investment, the financial grounding of Tokai Trim Group will be strengthened, which will enable them to further establish overseas operations and implement active and fast-paced strategies.”
J-Star has been actively exiting its portfolio as it gears up for a final close of its second private equity vehicle. Media reports said in June the firm is close to reaching its $210 million target, having raised $121 million by its first close.
In January, the firm said it had exited its investment in Olive des Olive, a branded clothing company, in a trade sale to Takisada Osaka, a Japanese textile wholesaler. Financial details were not disclosed, but a source close to the firm said earlier that it gained a 3x return multiple on the sale.
In October 2012, J-Star sold its 76.9 percent stake in Apo Plus Station to pharmaceutical company QOL in a deal worth about $50 million, Private Equity International reported earlier. A source said at the time the deal reaped a 3x return for the firm.