Report: TPG eyes 40% stake in Japanese lender

TPG Capital, the US-based private equity firm, is reportedly keen to acquire up to a 40 percent interest in Japan-listed NIS Group, a Tokyo-based lender to small businesses.

TPG Capital is eyeing a 30 to 40 percent stake in NIS Group, a listed Japanese lender, for more than ¥30 billion ($277 million; €186 million), according to Nikkei business daily. NIS Group lends to small businesses and consumers.

NIS Group’s shares surged ¥52, or 17 percent, to ¥351 at the close of trading on Monday after the Nikkei report – their biggest gain since 8 November, according to Bloomberg. The stock price has mostly been on a steady decline for the past two years.

News of TPG’s interest in NIS came on the heels of the lender disclosing plans to proceed with “definitive agreements relating to a strategic investment in the company by an international private equity firm” to strengthen the firm’s financial base.

Out of a proposed ¥30 billion investment, two-thirds would be in the form of new shares, convertible bonds and stock warrants, according to the statement. The remaining ¥10 billion would be invested in the holding company of Nissin Leasing (China), a subsidiary that provides operating leases, finance leases and services for offices and commercial facilities in China, through the purchase of new shares.

An official agreement between TPG and NIS, followed by an announcement of the deal, is likely by early December, according to Nikkei.

Last year, TPG Capital appointed Jun Tsusaka, a former banker and co-founder of a US buyout firm, as a partner to lead the firm’s investment activity in Japan. Tsusaka told PEO in an interview shortly after he was hired that he was keen to invest in Japan’s financial sector to take advantage of the firm’s investment experience in that area across Asia.