Permira's knowledge of the consumer sector will contribute to achieve Akindo's development plans. (Photo: Akindo/FIS)

Permira buys Japanese sushi chain

Private equity firm Permira is buying Japan's main sushi restaurant chain Akindo Sushiro Co Ltd for USD 1 billion. The amount includes debt -- and gives the sushi chain an enterprise value of about eight times last year’s earnings before interest, tax, depreciation and amortization -- and will be Japan's second-biggest buyout deal of 2012.

Permira, owner of the Bird’s Eye brand, made the deal with Japanese buyout fund Unison Capital and is already developing plans to expand the company nationally and to take the chain into China, according to Permira's co-head of Asia Alex Emery.

"The company is now in a position to double or triple the number of stores in the next decade," said Emery. "They have three stores in Korea, and they're actively thinking of China and other overseas markets."

Akindo Sushiro is the second large restaurant chain buyout for a global private equity firm to take place in Japan in the last year, after Bain Capital purchased Skylark for USD 2.1 billion in 2011, Reuters reports.

Emery said that sushi was an evolving industry in Japan.

"Sushi in particular is an extremely fragmented sector. The vast majority of sushi restaurants are mom-and-pop type of restaurants, relatively small and actually relatively expensive," Emery explained.

Akindo had annual sales of around JPY 100 billion (USD 1.3 billion) last year and has been expanding at around 10 per cent a year, said Emery.

"This is opening up a whole new segment and what is very attractive for us is the stage of growth Sushiro is in. If you take leading restaurant brands in Japan, they can get to 1,000 restaurants easily, yet Sushiro has only 335 restaurants, so you can say there is strong growth potential," Emery commented.

Emery said that Akindo’s development plans will be supported by its new owners’ knowledge of the consumer sector.

In late 2011, Permira signed a strategic agreement with a unit of state-owned China Development Bank to help both parties pursue private equity investments in China and beyond. The idea is to provide sushi at lower prices to increase demand.

"Sushi is enjoyed in many countries, but it's often an expensive proposition," said Emery. "If we can find a formula that allows people to eat sushi for the price of pizza, I think you would see massive demand."

By Natalia Real
[email protected]
www.seafood.media

Address:	80 Pall Mall
City:	London
State/ZIP:	England (SW1Y 5ES)
Country:	United Kingdom
Phone:	+44 20 7632 1000
Fax:	+44 20 7930 3185
More about:

Print