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Hitachi Koki reportedly in $1.27bn deal with KKR

Hitachi Koki
Acquisition   Hitachi Koki earned 1 billion yen in net profit

Hitachi intends to sell power tools unit Hitachi Koki to U.S. private equity firm Kohlberg Kravis Roberts (KKR) in a deal estimated to exceed 150 billion yen ($1.27 billion).


Negotiations are in the final stages. The Hitachi group had sought bids on a 50%-plus aggregate stake in Hitachi Koki, drawing offers from KKR, Kyoceraand others. The Japanese conglomerate gave KKR preferential negotiation rights as the U.S. company offered the best terms.

Selling the unit lets Hitachi focus on core business segments such as infrastructure and information technology.

An official agreement could be reached next month. KKR plans to purchase all of Hitachi Koki's outstanding shares through a tender offer. Hitachi Koki would be delisted from the Tokyo Stock Exchange's first section.

Hitachi Koki earned 1 billion yen in net profit on 141.5 billion yen in sales for the fiscal year ended in March 2016. KKR seeks to use its global network to support Hitachi Koki's overseas expansion. A future relisting is believed to be on the table.

 

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