KKR & Co. (KKR:US) agreed to buy Panasonic Corp. (6752)’s health-care unit for about 165 billion yen ($1.67 billion).
A wholly owned subsidiary of the U.S. private-equity firm will purchase all shares and assets of Panasonic Healthcare Co., according to a statement from the companies. KKR then will allocate 20 percent of the shares of the wholly owned unit to Panasonic. The Osaka-based Japanese electronics maker expects the transaction to add 75 billion yen in profit and said it is studying the effects of the sale on its annual forecast.
“We believe that partnering with KKR will also allow us to learn from KKR’s global operational and business management expertise as we pursue the next stage in growth,” Panasonic President Kazuhiro Tsuga said in the statement.
Panasonic Healthcare, which provides digital medical-record systems and makes instruments that measure blood glucose, would be KKR’s biggest acquisition in Japan, according to data compiled by Bloomberg. Panasonic is selling control of the unit as it focuses on a 250 billion-yen plan to reverse losses at its electronics business in the next two years.
New York-based KKR got preferential negotiating rights after two rounds of bidding, three people with knowledge of the matter said earlier this month.
KKR completed raising a $6 billion Asian-focused investment pool, its second for the region, this year. It raised a $4 billion pan-Asian fund in 2007 and a $1 billion fund focused on China in 2010. The firm said in July that it had deployed more than $5.5 billion in 30 companies throughout Asia.
In April, KKR said it hired Hirofumi Hirano, a former executive at AlixPartners LLP, to head its Japanese unit.
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