Private equity giant KKR (KKR) has upped its offer price for Japan-based IT company Fuji Soft in its ongoing complex takeover battle with U.S. rival Bain Capital (BCSF).
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Bain Could Come Back with Higher Offer
KKR raised its offer price for Fuji Soft, whose services include robotics technology and cloud integration, to $63.44 per share, up from its previous $61 per share move. That is around a 4% hike and is above Bain Capital’s last salvo of $62 per share which it made back in December.
That bid at the time was rejected by FujiSoft. But Fuji Soft’s share price climb of 2% at the close of trading on Tuesday indicates that investors are expecting that Bain will not ride off into the sunset but come back with an even better offer.
Corporate Japan is in the Spotlight
Fuji Soft is so attractive to the US bidders not just for its technological capabilities but because of the economic stasis which has affected Japan for many years. Despite moves from the Government to improve the performance of the corporate sector Japan and its companies are still seen as having underutilized assets, ineffective corporate governance and in the embryonic stage of digitalization. In short, there is a lot to play for.
KKR currently has a 33.97% stake in Fuji Soft following the first stage of a two-part bid in which two activist investors – 3D Investment Partners and Farallon Capital – agreed to tender their shares.
But KKR has so far failed to secure a majority because of Bain’s higher offer.
Is KKR a Good Stock to Buy?
On TipRanks, KKR has a Strong Buy consensus based on 10 Buy and 3 Hold ratings. Its highest price target is $199. KKR stock’s consensus price target is $172.62 implying an 14.35% upside.
