admin TOKYO/HONG KONG: Hitachi NSE 1.25 % Ltd plans to present a sale of its materials unit as early as next month in a deal that could be worth more than 700 billion yen ($6.6 billion), according to the sources.
Hitachi is planning to sell its 53% stake in Hitachi Metals Ltd, which creates components for cars and industrial equipment, as per the source person who declined to be named as they were not authorized to speak to the media.
Hitachi Metals had a market value of around 700 billion yen ($6.63 billion) based on Tuesday’s close. A buyout would exceed that amount given a premium would be expected.
Hitachi has booked Goldman Sachs Group to opine on the sale while Hitachi Metals has hired Bank of America, source person said.
The conglomerate informedin August it was considering various options for the metals unit.
Japanese conglomerates are driving the country’s M&A rebound as they reorganize. Deals taking businesses private have amounted to $41.8 billion this year, up 34% year on year, according to Dealogic.
On Tuesday state-backed Nippon Telegraph and Telephone Corp (NTT) declared it planned to take its wireless carrier business NTT Docomo Inc private in a deal worth 4.25 trillion yen.
Hitachi sold chemical unit Hitachi Chemical Co to Showa Denko and a diagnostic imaging business to Fujifilm Holdings Corp in December 2019.
Earlier, Hitachi sold semiconductor equipment maker Hitachi Kokusai Electric and power tool unit Hitachi Koki, both to KKR. Also, it sold car navigation maker Clarion Co to France’s Faurecia SA.
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