TOKYO -- Advantage Partners has created a 60 billion yen ($540 million) fund to acquire and enhance small and midsize companies, in particular those whose aging founders are looking to sell.
The fund, the fifth from the Tokyo-based private equity firm, is designed to spend several billion yen each on more than 10 businesses over 10 years, support management in boosting the value of these companies and then sell them at a profit. The fund makes two main types of investments: in businesses whose founders or owners are looking for successors, and in spin-outs from listed companies.
Double-digit returns are envisioned for the fund, which has drawn contributions from financial institutions such as regional banks that are struggling to maintain gains amid Japan's ultralow interest rates. Other asset management companies have taken note of this favorable environment: Japan's Tokio Marine Capital and Nippon Sangyo Suishin Kiko both formed funds of around 50 billion yen recently.
Advantage has been part of the private equity landscape since 1992. Past investments include beverage maker Pokka; restaurant, hotel and wedding venue operator Hiramatsu; restaurant operator Reins International; and outdoor equipment seller ISG Ishii-sports.