KKR to Buy All of Hitachi Transport, Including 40% Hitachi Stake

Reed Stevenson, Bloomberg News

The logo of Hitachi Ltd. displayed at the company's headquarters in Tokyo, Japan, on Jan. 18, 2022. Hitachi is ready to sell its 40% stake in Hitachi Transport System but wants to find the right industry partner, according to Chief Executive Officer Toshiaki Higashihara. Photographer: Shoko Takayasu/Bloomberg , Bloomberg

(Bloomberg) -- Hitachi Ltd. is selling its 40% holding in Hitachi Transport System Ltd. to KKR & Co., which is planning a tender offer to take the logistics company private, the conglomerate said.

KKR is offering 8,913 yen ($68.52) a share for Hitachi Transport, the private equity investor said in a statement Thursday. The offer, which will start by late September 2022, is a 166% premium to Hitachi Transport’s 12-month average closing price through yesterday, KKR said.

Hitachi intends to re-invest and own around 10% in Hitachi Transport after KKR’s acquisition and the unit’s delisting, according to the statement. In total, KKR is investing about 700 billion yen, people with knowledge of the matter have said.

Read more: Hitachi Is Said to Near Sale of Stake in Transport Unit to KKR

Once a sprawling conglomerate and the country’s biggest loss-maker, Hitachi has been divesting assets to focus on its core businesses of power grids, nuclear energy, automotive parts, train infrastructure and industrial products, linking many of them with its own software. Hitachi Construction Machinery Co., Hitachi Metals Ltd., and Hitachi Kokusai Electric Inc. are all targeted for sale, or are in the process already.

Read more: Hitachi’s $18 Billion Divestment Drive Kept Activists at Bay

A purchase of Hitachi Transport stake will mark another significant deal for KKR in the region. The U.S. private equity firm last week led a consortium in offering to acquire Australian hospital operator Ramsay Health Care Ltd. for about $15 billion, which could be KKR’s biggest ever buyout in Asia Pacific.

KKR beat out rivals including Blackstone Inc., Bain Capital and Baring Private Equity Asia in the process, the people said.