(Bloomberg) -- KKR & Co. is moving up the start of its tender offer for Fuji Soft Inc. to Sept. 5, decreasing the likelihood of a bidding war with private equity rival Bain Capital in Japan.
KKR accelerated its ¥558.4 billion ($3.9 billion) buyout from the originally scheduled mid-September start, Fuji Soft said in a statement. The measure, reported earlier by Bloomberg, would get a deal moving before Bain formally submits a proposal to buy out Fuji Soft for 5% more than KKR’s offer of ¥8,800 a share, or around ¥9,200 to ¥9,300 per share.
Bain’s higher-priced non-binding offer spurred hopes for a rare Japanese bidding war, propelling Fuji Soft’s stock above the offer prices, with shares jumping 7.4% to a record high ¥9,630 on Wednesday in Tokyo.
Bain has said that it plans to submit a legally-binding proposal as early as October to launch a possible take-private buyout in November. KKR’s accelerated tender offer, which closes on Oct. 21, increases the chances that its takeover will be completed before then.
Private equity firms are circling Japan for potential deals, even as growing technological protectionism worldwide limits the number of realistic targets. Last month, Japan designated chipmaking equipment as a sector key to national security, requiring prior notice and screening of foreign investors planning to take a stake.
But a weaker yen and regulators’ emphasis on shareholder value and governance are now encouraging companies to test the country’s willingness to embrace M&A, most recently with Alimentation Couche-Tard Inc.’s proposed buyout of Seven & i Holdings Co.
Yokohama-based Fuji Soft contracts software from Fujitsu Ltd., a supplier of computer systems for some of Japan’s biggest banks such as Mizuho Financial Group Inc. and government agencies. The software company’s been fielding demands from Singapore-based 3D Investment Partners, its largest shareholder according to Bloomberg-compiled data, to consider steps such as taking the company private.
Bain said in a statement earlier in the week that it “highly valued the target firm’s market advantages, business potential and potential value.”
Fuji Soft said it agreed to a buyout by KKR, even though it had also received a higher-priced offer from Bain, because it judged KKR’s offer was legally binding and more certain to occur. It also said Bain’s offer had not obtained consent from 3D Investment Partners and that there remained doubts about how the deal would be financed.
--With assistance from Lisa Du and Jake Rudnitsky.
(Updates with Fuji Soft statement in the second paragraph)
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