Carlyle Group has emerged as the frontrunner to acquire Hogy Medical, moving ahead of rival private equity bidders in one of Japan’s most closely watched healthcare take-private situations, according to sources cited by Bloomberg.

The firm is in advanced negotiations and aims to reach an agreement soon.

Hogy Medical’s shares have risen 20% this year, giving the Tokyo-listed surgical products maker a market value of about $826m. While Carlyle is currently leading, the process remains competitive and talks could still fall through, sources said.

The company produces surgical masks, gowns, and sterile packaging for medical instruments. Activist investor Dalton Investments holds a 15.2% stake and has pushed the company to evaluate options, including a potential privatisation and strengthened oversight through more outside directors.

Hogy said in October that it continuously reviews strategic alternatives, including going private, but stressed that no decisions have been made. Earlier reporting from Mergermarket also flagged takeover discussions, though the company noted that such reports were not based on any official announcement.

The potential buyout comes as private equity activity in Japan reaches record levels. Deal volumes have surged to $337bn this year, nearly 120% higher than in 2024, driven by corporate carve-outs, succession planning, and rising shareholder activism.

Carlyle declined to comment, and Hogy Medical did not respond to queries.

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