PE firm Integral buys stake in Tokyo-listed Sanden Holdings unit for $471m

Mount Fuji and buildings are reflected on a table at an observation deck in Tokyo, Japan. Photographer: Kiyoshi Ota

Private equity firm Integral Corporation has agreed to acquire Sanden Retail Systems Corporation, the consolidated subsidiary of Tokyo-listed Sanden Holdings, for a consideration of ¥50 billion ($471 million), the Japanese firm said in a disclosure.

Integral will acquire shares in Sanden Retail for ¥39.8 billion and then assume responsibility for ¥10.2 billion in debt. The deal involves 27,601 shares and Integral will indirectly hold 20 per cent of the voting rights in Sanden Retail.

Sanden Retail Systems is a Japanese retail systems manufacturer with a global footprint in Japan, the United States, Europe, and Asia. It is involved in the manufacture and sales of freezing and refrigeration showcases for commercial use and vending machines for beverage and food sale.

It posted net income of ¥311 million in the fiscal year ended March 2019.

Sanden Holdings said it has decided to sell its commercial store systems business to Integral to ensure that the business will continue to achieve its target growth as it also focuses on its automotive systems business.

The group judged that by transferring shares of Sanden Retail to Integral, it is possible to further accelerate growth for the future in the commercial store systems business by utilising the extensive networks and management resources of Integral.

“It is difficult to commit sufficient management resources for accelerating growth to both the automotive systems business and the commercial store systems business,” Sanden Holdings said. Selling the unit to Integral will ensure that resources are allocated and growth is accelerated.

In a statement, Integral said it aims to further grow Sanden Retail System’s business.

“Integral will support the company to strengthen its managerial functions as an independent company by providing management support through its ‘i-Engine’ function,” the PE firm said.

Integral was founded in September 2007 as an independent Japanese private equity company investing in listed and unlisted companies in Japan. It makes equity investments from a long-range perspective through its unique “hybrid investment” approach, utilizing both principal and fund money for investment.