KKR to support accelerated global growth of
Hitachi Koki
Leading global investment firm KKR today announced that HK
Holdings Co., Ltd. (the “Bidder”), an entity owned by investment
funds controlled by KKR, intends to make a tender offer for all the
existing common shares and stock acquisition rights of leading
power tool and life science equipment manufacturer Hitachi Koki
Co., Ltd. (“Hitachi Koki” or the “Company”) (Code number: 6581,
First Section of the Tokyo Stock Exchange).
In connection with the tender offer, the Bidder has entered into
a tender agreement (the “Tender Agreement”) with Hitachi Ltd.
(“Hitachi”), the lead shareholder in Hitachi Koki, to acquire in
the tender offer Hitachi’s approximate 40.25% holding of Hitachi
Koki’s common shares, and also with Hitachi Urban Investment, Ltd.
(“HUI”) to acquire in the tender offer HUI’s approximate 10.90%
holding of Hitachi Koki’s common shares. The tender offer will
launch subject to the fulfillment of certain conditions in the
Tender Agreement, and is expected to commence on January 30, 2017
(for details regarding the conditions for the commencement of the
tender offer, please refer to the full text of the press release
issued today by Hitachi Koki titled “Announcement Concerning
Opinion Regarding the Tender Offer for the Shares of Hitachi Koki
Co., Ltd. by HK Holdings Co., Ltd.” and its attachment titled
“Announcement Regarding the Tender Offer for the Shares of Hitachi
Koki Co., Ltd. (Securities Code 6581)” (the “HK press
release”).
Hitachi Koki is a leading supplier of high performance, high
quality power tools and life science equipment, competing in the
global marketplace to introduce cordless technology to a wider
range of power tool products and applications. The Company is
actively pursuing expansion in global markets, and has acquired
German power tool company metabo Aktiengesellschaft in March 2016.
It has also formed a strategic alliance with major North American
hardware chain Lowe’s Companies, Inc. in 2015.
Pending a successful outcome in the Bidder’s tender offer, KKR
intends to work closely with Hitachi Koki’s management and
employees, leveraging Hitachi Koki’s excellent technology
development capabilities and KKR’s global resources and the
experience of its worldwide team to identify opportunities to
strengthen the Company’s business platform. These opportunities may
include implementing operational improvement initiatives and
identifying and executing acquisitions globally with the aim of
growing Hitachi Koki’s corporate value.
Under the terms of the announced offer under Japan’s Financial
Instruments and Exchange Act, among other terms, the Bidder will
commence the tender offer to acquire the issued common stock and
stock acquisition rights of Hitachi Koki. In addition, based on the
Bidder’s proposal, Hitachi Koki plans to pay a special dividend
(the “Special Dividend”) conditional upon the success of the tender
offer, with a record date of January 29, 2017. The Bidder has set a
value of Hitachi Koki common shares of JPY 1,450 per common share.
Assuming the payment of the Special Dividend of JPY 580 per common
share upon the success of the Tender Offer, the Bidder has set a
tender offer price per common share of JPY 870. The tender offer
price per Hitachi Koki stock acquisition right will be JPY 144,900.
(For further details please see the HK press release issued by
Hitachi Koki today)
The value per share represents:1
- A premium of 89.8% to Hitachi Koki’s
12-month average closing price to October 4, 2016
- A premium of 108.0% to Hitachi Koki’s
6-month average closing price to October 4, 2016.
Since the total number of Hitachi Koki’s common shares is equal
to 101,429,921 (number of issued shares excluding treasury shares;
including the number of shares subject to stock acquisition
rights), this transaction values Hitachi Koki at JPY 147.1 billion
(approx. US$1.28 billion at the exchange rate of US$1=JPY115).
Mr. Hiro Hirano, Member of KKR and CEO of KKR Japan, said,
“Hitachi Koki is a world-class manufacturer of power tools and a
developer of innovative tool technologies. The Company is
well-positioned for further organic and inorganic growth given the
high quality of its products, its high-caliber team and the
attractive environment for power tools through cordless and digital
trends. Looking ahead, we are fully committed to leveraging our
global network and resources to provide full support to Hitachi
Koki in pursuing its growth strategy.”
KKR makes its proposed investment predominantly from its Asian
Fund II. KKR has been investing in Japan through its pan-regional
private equity funds since 2010. Japan has been and continues to be
a key focus for KKR in the region. To date, KKR has completed three
acquisitions in the market: Intelligence Ltd., a leading human
resources services company; Panasonic Healthcare, the carve-out
health care business of Panasonic Corporation; and Pioneer DJ, the
carve-out DJ equipment business of Pioneer Corporation. In
addition, on November 22, 2016 KKR announced the launch of a tender
offer for Calsonic Kansei.
This press release should be read in conjunction with the full
text of the HK press release, which is available
on www.jpx.co.jp.
This press release has been prepared for the purpose of
informing the public of the tender offer and has not been prepared
for the purpose of soliciting an offer to sell, or making an offer
to purchase, any securities. If shareholders wish to make an offer
to sell their shares in the tender offer, they should first read
the Tender Offer Explanation Statement for the tender offer and
offer their shares or stock options for sale at their own
discretion. This press release shall neither be, nor constitute a
part of, an offer to sell or purchase, or a solicitation of an
offer to sell or purchase, any securities, and neither this press
release (or a part thereof) nor its distribution shall be
interpreted to be the basis of any agreement in relation to the
tender offer, and this press release may not be relied on at the
time of entering into any such agreement.
The tender offer will be conducted for common shares and stock
acquisition rights of Hitachi Koki, a company established in Japan.
The tender offer will be conducted in accordance with the
procedures and information disclosure standards prescribed by
Japanese law, which may differ from the procedures and information
disclosure standards in the United States. In particular, Section
13(e) and Section 14(d) of the U.S. Securities Exchange Act of 1934
and the rules prescribed thereunder do not apply to the tender
offer, and the tender offer does not conform to those procedures
and standards.
Unless otherwise specified, all procedures relating to the
tender offer are to be conducted entirely in Japanese. If all or
any part of a document relating to the tender offer is prepared in
the English language and there is any inconsistency between the
English-language documentation and the Japanese-language
documentation, the Japanese-language documentation will
prevail.
The financial advisors to the Bidder and the Company as well as
the tender offer agent may engage in the purchase of shares of the
Company for their own account or for their customers’ accounts to
the extent permitted under the Japanese Financial Instruments and
Exchange Act, and the Bidder acknowledges such purchases. In the
event information regarding such purchases is disclosed in Japan,
such information will also be disclosed in English on the website
of Hitachi Koki or the financial advisor conducting such purchases
or the website of the tender offer agent, or will otherwise be made
publicly available.
About KKR
KKR is a leading global investment firm that manages investments
across multiple asset classes including private equity, energy,
infrastructure, real estate, credit and hedge funds. KKR aims to
generate attractive investment returns by following a patient and
disciplined investment approach, employing world‐class people, and
driving growth and value creation at the asset level. KKR invests
its own capital alongside its partners’ capital and brings
opportunities to others through its capital markets business.
References to KKR’s investments may include the activities of its
sponsored funds. For additional information about KKR &
Co. L.P. (NYSE:KKR), please visit KKR’s website
at www.kkr.com and on Twitter @KKR_Co.
1 The figures set out above are based on the Hitachi Koki
closing share prices extracted from Bloomberg as at and prior to
the last full trading day (October 4, 2016) immediately prior to
the day of publication of speculative media reports regarding the
tender offer (the ‘unaffected price’).
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170112006175/en/
Media:KKR Asia PacificAnita Davis,
+852-3692-7335anita.davis@kkr.comorKKR New YorkKristi Huller, +1
212-230-9722kristi.huller@kkr.comorFor KKR JapanAshton
ConsultingJohn Sunley, +81-3-5425-7220jas@ashton.jporBrendan
Jennings, +81-3-5425-7220b.jennings@ashton.jp
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