Investment Solutions

Example of solutions to a challenge faced by small and medium-sized companies in Japan.

Business Succession

Japanese SMEs are generally highly dependent on their founders, and many founder presidents feel that business succession is an issue for them. In addition to business succession due to aging, early successions by young presidents are on the rise. For example, you may have achieved a certain level of growth in a short period but find it difficult to lead your company to the next step and seek a partner, or you may have other business ambitions and sell your current business. J-STAR will propose an appropriate succession management system plan for both internal and external succession of the successor and support the creation of a lasting company that does not depend on a specific individual together with the executives and employees.

Past case example
After obtaining the majority of the shares from the founder president, we supported the succession plan to the next generation by gradually reducing the dependence on the founder.
Past case example
In consultation with the founder, who had experienced rapid expansion since the company’s inception and felt the limits of individual management, we invited a new management team suitable for business operation in a period of growth. We also supported the smooth handover following the acquisition of shares (external invitation).
Past case example
The second generation of management, who had taken over the company, wanted to achieve the revolutionary growth that his predecessor’s system had failed to realize, so he partnered with us in his decision-making process. We help him to reorganize the management structure as a partner.

Shareholder Restructuring

Initially, the company aimed for an IPO, and shareholders included executives, employees, and venture funds, but in some cases, the company abandoned the listing due to changes in the business environment and the cost of maintaining the listing. In such cases, we provide opportunities for shareholders, management, and employees to realize their shares into cash.

Past case example
The consultation was from a founder who had experienced rapid growth since the inception and felt limited in managing the company by himself at that stage. We invited a new management team suitable for the company during its growth period and supported the smooth succession of management with the acquisition of shares.

Business Restructuring and Revitalization

While diversifying sources of revenue, we support companies that have fallen into excessive debt due to failures outside of their core business, or companies that are performing well but have low credibility with customers and financial institutions due to undercapitalization caused by past business failures, by carving out quality divisions and capital injection.

Past case example
We support a company that had become effectively insolvent due to losses from past failed projects for their capital adequacy ratio by injecting new capital into them. In addition, the company worked to restore the confidence of financial institutions by building a system that allows for external accountability, including global consolidation and reduced the cost of debt by reviewing and refinancing existing loans (correction of undercapitalization).
Past case example
The company’s core business was doing well, but it had excessive debt due to failures in its restaurant business and stock and real estate investments. We carved out the core business and supported the company within the revitalization framework.

Management Buyout

In the process of continued operation of a company, the shares of the company may remain in the owner’s family while someone from outside the owner’s family may become responsible for the management. In such a case, since the company ownership and management are separated, slow decision-making and other issues may arise when managing the company. J-STAR serves as a sponsor for managers and provides the capital to purchase shares in order to strengthen the management structure of companies.

Past case example
When a listed company aims to list a wholly-owned subsidiary in the same industry, we support the subsidiary’s management team in the management buyout scenario to avoid problems between the two companies in the stock market (support for company independence through the subsidiary’s management team).
Past case example
Following the sudden passing of the company’s founder, the company’s shares were held by an outside relative. Along with providing funds for the acquisition of shares, we helped the company establish a management system under the new capital structure (management buyout).

Growth Capital

We provide growth capital to companies or businesses with high growth potential.

Past case example
To achieve sales growth, we are developing new business partners. We also gained a platform for business development through the acquisition of companies.

Business Support

Through J-STAR’s investment and involvement in the management, we provide various support to the portfolio companies. Several examples of such support are described below.

M&A support

We support business expansion through mergers and acquisitions and other solutions by leveraging J-STAR’s rich network and experiences in the financial sector.

Management team formation and strengthening support

We believe that many SMEs’ challenges are related to human resources and can be solved by getting the right people. J-STAR will work with the company’s management team to bring in future leaders from external human resources and train professional employees in-house. From our perspective as a shareholder/external director, we support the formation and strengthening of a more multifaceted management team.

Business Optimization

During the expansion phase of the business, a company may be concerned about unprofitable projects and unnecessary costs by expanding factories and sales offices, securing human resources, and increasing orders. We can conduct more efficient and optimized management by identifying essential resources.

Global Expansion

Following Japan’s population declines, the domestic market tends to shrink. As a result, more and more companies are looking overseas for growth opportunities. However, companies often face several hurdles when expanding their business overseas. We help companies solve the problems overseas, such as cultural and legal differences as well as lack of communication due to the physical distance between locations.