Bain Capital to Launch Hostile Tender Offer for Fuji Soft Shares
TOKYO (Reuters) – Private equity firm Bain Capital has announced plans to launch a tender offer for Fuji Soft shares, even without the backing of the Japanese company’s board, following the failure of its previous bid to acquire the shares. The estimated $2 billion bid for nearly half of Fuji Soft’s shares could lead to a hostile takeover battle between Bain Capital and rival suitor KKR.
Bain Capital has offered 9,600 yen per share, 1.6% higher than KKR’s bid, and has received support from Fuji Soft’s founder and major shareholder, Hiroshi Nozawa. Nozawa holds an 18.6% stake in the company and has called Bain a "white knight."
KKR, which has secured the backing of Fuji Soft’s board, had managed to acquire 33.9% of the shares in a first-round tender. However, Bain Capital is not deterred, and has expressed "strong concerns and distrust" over Fuji Soft’s response to its proposal.
The governance of Fuji Soft has raised concerns, with the Japanese company citing the risk of governance deadlock if Bain Capital were to acquire a controlling interest. However, Bain Capital has argued that this eliminates the risk, and questioned the independence of a special committee set up to examine the merits of the deal.
Fuji Soft’s IT services are in high demand, particularly given Japan’s shrinking domestic market, and the company has real estate assets that could be sold to fund its business. The company is valued at around $7 billion, making it one of the largest M&A targets in Japan.
If the bid is successful, it could lead to a heated bidding war, as Fuji Soft’s share price rose 1.3% to 9,771 yen following the news.
