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KKR eyes investment partnership with Innovation Network Corporation of Japan

20 May 2014

Global buyout group KKR is looking to partner with a Japanese state-backed investment fund to invest alongside each other, Reuters has reported.

Hirofumi Hirano, chief executive of KKR Japan, said that the firm was in discussions with Innovation Network Corporation of Japan (INCJ) over future investments.

In December 2012 INCJ pipped KKR to take over struggling Japanese computer chip maker Renesas.

Shortly after KKR partnered with fellow private equity houses Carlyle and Bain to urge Japan to limit the presence of government-backed funds, which they say delay restructuring for troubled companies and limit opportunities for private capital.

However, Hirano told Reuters that state-backed and private investors could work together.

“Each deal has a different group of investors, such as equity investors, senior debt providers and mezzanine debt providers and they all have different return targets.

“The benefit to teaming with state-backed funds is that they have a lot of information. What they know is different from what we do. For example, they know who has the most advanced technology,” he said.

Last year KKR realised a return of five times from its sale of Japanese recruitment specialist Intelligence Holdings, at the time its only investment in the country. It since acquired the healthcare arm of Panasonic for $1.62bn, in one of Asia’s largest private equity buyouts..

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