Photographer: Chris Ratcliffe/Bloomberg
KKR Lifts Hitachi Kokusai Bid a Second Time as Shares RallyBy
Buyout firm offers 3,132 yen a share for chip-systems maker
Elliott Management has raised holdings in Hitachi Kokusai
KKR & Co. raised its offer for Hitachi Kokusai Electric Inc. a second time after a rally in the shares of the chip-systems maker spurred many investors including Elliott Management Corp. to seek a higher price from the buyout firm.
The New York-based private-equity company increased its October bid by 8 percent to 3,132 yen a share Friday, compared with its last closing price of 3,290 yen. The latest development values the target at about $3 billion.
The sale of the unit is part of Hitachi Ltd. Chief Executive Officer Toshiaki Higashihara’s plan to spin off non-core units while focusing on digital technology to help boost sales in its car parts, train and energy businesses. Hitachi has said it is considering various ways to strengthen its business, including disposing of non-core operations.
Since KKR initially said April 26 that it would bid at 2,503 yen apiece, shares of Hitachi Kokusai have rallied 38 percent, compared with an 18 percent advance in Japan’s benchmark Nikkei 225 stock index.
Amid expectations KKR would raise its offer price after the gains, New York-based activist investor Elliott has been building up its holdings in Hitachi Kokusai. After first revealing owning more than 5 percent of the company on Sept. 11, Elliott had almost 9 percent as of Oct. 12, according to filings.