Murakami-backed fund outbids Carlyle in battle for energy firm Japan Asia Group

Photo: Reuters

A Japanese fund backed by veteran investor Yoshiaki Murakami plans to make an 18 billion yen ($173 million) bid for energy and environment firm Japan Asia Group (JAG), topping a management buyout offer backed by Carlyle Group.

City Index Eleventh said on Thursday it would offer 840 yen per share for JAG, a 40% premium to Carlyle’s offer of 600 yen.

Global buyout fund Carlyle teamed up with JAG’s chairman and CEO Tetsuo Yamashita in November to launch the management buyout that values JAG at 16.4 billion yen and is worth 37 billion yen in total, including two other JAG businesses.

JAG shares have more than doubled since Nov. 4, the day before that announcement, reaching 785 yen on Thursday.

JAG was not immediately available to comment on City Index Eleventh’s proposal. Carlyle declined to comment.

Earlier on Thursday, JAG said Carlyle had extended its bid for a second time to Jan. 28 as its shares were trading above Carlyle’s offer.

JAG is the latest company to become a battleground between Murakami‘s fund and a global private equity firm, following Bain Capital’s failed bid for a printing firm in 2019.

City Index Eleventh, which with other parties already has a 19.05% stake in JAG, had described Carlyle’s bid as “unfairly” cheap and asked it to raise the offer price, but was rebuffed.

“We have terminated talks with Carlyle and decided to launch our own bid at 840 yen, which represents per share capital for JAG,” said City Index Eleventh.

The activist fund did not say when it would launch the bid.

U.S. buyout fund Bain Capital failed in 2019 in its bid to buy a small printing firm Kosaido Co after a fund backed by Murakami said Bain’s offer undervalued the company.

Reuters

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.