KKR plans $4bn Fuji Soft take-private deal

Aug 16, 2024 | News | 0 comments

David bonderman

US private equity major KKR is planning to take Japanese systems developer Fuji Soft private in a deal valued at around JPY600bn ($4.13bn), according to a report by NikkeiAsia citing unnamed sources familiar with the matter.

The move comes amid pressure from Fuji Soft’s largest shareholder, Singapore-based 3D Investment Partners, which holds a 21.45% stake in the business.

The tender offer is expected to be priced at just under JPY9,000 per share, representing a roughly 20% premium over Wednesday’s closing price. Following the buyout, Fuji Soft’s founding family and management are expected to reinvest in the company.

Fuji Soft announced on Wednesday that it will discuss the proposal at a board meeting scheduled for Thursday and will promptly disclose any decisions made.

The dispute with 3D centres around the prominent role of Fuji Soft’s founding family in the company’s management. 3D has been urging the company to improve its capital efficiency, which its says lags competitors.

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In 2022, 3D submitted proposals at two shareholder meetings, calling on Fuji Soft to appoint outside directors recommended by the fund. Last September, 3D proposed that Fuji Soft go private. In response, Fuji Soft established a special committee of outside directors to explore whether becoming a private company would better enhance its value. The committee reportedly concluded that privatisation under the control of a single shareholder, coupled with a long-term growth strategy, would be the more advantageous route.

Fuji Soft is listed on the Tokyo Stock Exchange’s Prime section and is known for developing control software for vehicles and industrial equipment. It is a prominent player among systems integrators in Japan.

In 2023, Fuji Soft reported a 7% increase in group sales, reaching JPY298.8bn. The company’s medium-term plan, targets JPY435bn in annual sales by 2028 and includes initiatives in emerging fields such as generative artificial intelligence and fifth-generation wireless technology.

Source:  Private Equity Wire

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