Japanese middle-market private equity firm Nippon Sangyo Suishin Kiko (NSSK) has agreed to acquire Tokyo-headquartered Fujikura’s power transmission component business.
The investment is being made through NSSK’s second fund. The financial terms of the deal remain undisclosed. The transaction is slated for completion on October 1, 2021, NSSK said in a statement.
The target unit comprises Fujikura Components and Fujikura Line Tech Taiwan. Fujikura Components’ current management team will continue to manage the company, NSSK added.
Founded in 1949, Fujikura Components makes electric power transmission components and spiral products attached to overhead power transmission lines and underground cables for electric power companies and renewable energy operators in Japan.
The company also makes connectors for quick charging cables for electric vehicles, mainly in Europe. It operates two manufacturing bases in Ishioka City and Ozumachi, Japan, as well as a Taiwan factory in Kaohsiung City.
“In recent years, the electric power sector in Japan has been experiencing many changes in the business environment, such as increasing demand for upgrades for aging power transmission and distribution equipment, reinforcement of the electric power system in line with expanding renewable energy as well as wheeling charge reform planned in 2023,” NSSK said.
The private equity firm said it will support Fujikura Components through its value creation initiative called Value Up Programme. The PE firm will help the firm implement global business practices in sales growth, product line-ups, accounting, finance, governance, compliance, corporate philosophy and ESG.
The firm’s second fund, NSSK II, closed in 2017 at 60 billion yen ($549 million). The size of NSSK I, which was formed in 2015, could not be ascertained.
NSSK II invests mainly in Japan-based small to medium-sized companies that contribute to the development and the revitalisation of the local economy. The fund also has parallel investment vehicles, according to NSSK’s website. NSSK also manages five regional impact funds in Japan.