Bain Capital plans to list Seven & i Holdings' supermarket and retail business within three years after enhancing synergies within the group, as stated by an executive from the U.S. private equity firm on Thursday.
In addition to increasing the size of the business, Bain intends to pursue growth opportunities through acquiring rival retail chains and technology companies to advance digital operations, according to Bain partner Naofumi Nishi in an interview with Reuters.
Nishi emphasized the potential in the fragmented food supermarket industry for leveraging economies of scale and expressed interest in acquisitions by saying, "If the opportunity arises, we would like to actively consider acquisitions of other companies."
Recently, Seven & i agreed to sell its non-core businesses, including its expansive supermarket operations under York Holdings, to Bain for 814.7 billion yen ($5.50 billion), with Seven & i and its founding families reinvesting to retain a 40% stake in York.
The York business encompasses 29 units, including the renowned Ito-Yokado chain, Akachan Honpo baby goods stores, and the operator of Denny's restaurants in Japan, with Nishi highlighting the prime locations of the stores and their growth potential.
Bain's heightened investments in the Japanese retail and consumer goods sectors involve recent acquisitions of outdoor gear producer Snow Peak and pajama brand Mash Holdings' Gelato Pique label.
In Japan, increased deal-making activity is observed among global funds like Bain, KKR, and Blackstone, targeting investments with perceived weak corporate governance or undervalued assets that could be restructured to enhance shareholder value.
During the bidding for the York business, Bain faced competition from KKR and Japanese buyout firm Japan Industrial Partners.
(This text has been edited for clarity and coherence.)