Japan's banner year for buyouts is just the start of a bigger boom in the market, says the fund responsible for more than four-fifths of private equity deals in the country by value in 2017.
The year won't be a one-off, says Yuji Sugimoto, the Japan head for Bain Capital Ltd. Japan Inc. will need to turn to deep-pocketed partners to turn around or carve out failing business units as the country's companies push themselves to become more profitable for shareholders, a chronic problem that Prime Minister Shinzo Abe is seeking to resolve through his corporate governance overhaul.
Bain spent an estimated $1.2 billion (around ¥130 billion) last month to acquire 87 percent of Japan's third-largest advertising agency, Asatsu-DK Inc., through a tender offer that initially drew criticism from shareholders over the price. In September, an investor group led by the Boston-based firm inked a $18 billion deal to buy cash-strapped Toshiba Corp.'s memory-chip business after months of contentious negotiations.