J-Star Exits From Elderly-focused Mail Order Business At A High ROI

On September 7th, J-Star announced that it has transferred all of the shares of Iki Iki K.K., a mail order business focusing on growing elderly population in Japan,  to NK Relations Co., Ltd., a wholly-owned subsidiary of Noritsu Koki Co., Ltd. Noritsu Koki has its origin as a manufacturer of film processing machines, but has been expanding business lines to include medical care, food and environments.

J-Star fund and its co-investors acquired Iki Iki in 2009 for about USD 13 million. As this was a turnaround investment under the Civili Rehabilitation Act, the entry multiple was extremely low and no leverage was used. According to a source quoted by PEI Asia, the sale price to Noritsu was approx. USD 100 million. J-Star CEO was quoted as saying "(During the holding period) EBITDA grew from $5.8 million to $12.5 million and net cash increased more than seven times to $18.3 million".

This is another example where operational improvement brought a significant ROI. "Silver Business" is the way to go.