Who will buy Citi’s Japanese unit Bellsystem24?



image According to some sources next week only four or five companies will submit formal bids for Bellsystem24, a Japanese telemarketer owned by Nikko Principal Investments, the private-equity arm of Citigroup while about 20 buyout firms have reviewed the books of Bellsystem24. Among those who are determined to bid there are Permira and KKR KKR.UL. The deal is worth more than $1 billion.

Apart from Permira and Kohlberg Kravis Roberts & Co, potential bidders include CVC Capital and Bain Capital. Meantime, according to the unidentified sources a number of firms, which are not actively working on the deal now, may jump into the race if they get invited to partner prominent bidders.

"This is the only mega deal we have seen in the past few years," said an official at a Tokyo-based private equity firm. "In Japan, where large companies are still reluctant to take drastic decisions to sell their non-core assets, it is difficult to see a big deal that is available for private equity."

The Bellsystem24 deal would be the largest transaction involving foreign private equity firms since October 2007 when Permira agreed to buy agrichemical company Arysta LifeScience Corp for $2.2 billion.

Permira has not made any investments in Japan since then.

Bellsystem24 would be a perfect match for KKR, which said it was targeting companies with "large capitalization" in Japan. KKR opened an office in Tokyo in 2006 but has not yet made a major investment in Japan.

For KKR, a Bellsystem24 deal would follow its purchase of Oriental Brewery for $1.8 billion from Anheuser-Busch InBev INTB.BR in South Korea.




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