Panasonic and KKR to partner in healthcare firm

TOKYO & NEW YORK – Panasonic Corporation and Kohlberg Kravis Roberts & Co. L.P. (KKR) today announced the signing of a share purchase agreement and a shareholders’ agreement under which Panasonic and KKR will become joint partners of Panasonic Healthcare Co., Ltd.

Based on the agreements, PHC Holdings Co, Ltd. (“PHCHD"), which is wholly-owned by KKR investment funds, will purchase all outstanding shares of Panasonic Healthcare, including its related intellectual property and assets, for an equity value of approximately JPY 165 billion (approximately US$ 1.67 billion). The transaction will be followed by a third party share allocation by PHCHD, after which KKR will own 80% of outstanding shares of PHCHD and Panasonic will own 20%. Panasonic and KKR will cooperate in the management of Panasonic Healthcare.

Panasonic Healthcare is a comprehensive healthcare company focusing on three core businesses—In Vitro Diagnostics, Medicom, and Biomedical. The In Vitro Diagnostics business has a leading global market share in the manufacture and sale of blood glucose monitoring meters and sensors for diabetics. Its Medicom business has the top share in Japan in medical receipt computers, electronic health record systems and other IT equipment for medical clinics, while its Biomedical business has a leading market share in Japan and overseas in biomedical laboratory equipment including CO₂ incubators and ultra-low temperature freezers.

Panasonic and KKR will leverage their respective business resources, including their healthcare industry knowledge, technology, and specialist expertise, as well as their global healthcare industry investment experience and network, to together aim for further growth of Panasonic Healthcare.

Panasonic president, Kazuhiro Tsuga, said, “As previously announced in Panasonic’s New Midterm Management Plan, we have been seeking a partner who shares our vision for achieving a step change in the growth and evolution of Panasonic Healthcare. We understand KKR has been actively investing in the expanding healthcare sector, and we highly respect KKR’s industry expertise and its capability to provide the necessary growth capital and operational know-how, in preparation for the future development of Panasonic Healthcare in the global healthcare industry. Through our partnership, Panasonic will work with KKR to support the growth of Panasonic Healthcare, which will continue to be a member of the Panasonic Group. At the same time, we believe that partnering with KKR will also allow us to learn from KKR’s global operational and business management expertise as we pursue the next stage in growth for Panasonic.”

Commenting on the agreements, KKR’s co-founder and Co-CEO Henry Kravis said, “Panasonic Healthcare has excellent market positions and high-level technical capabilities, and we believe it has significant growth potential. Panasonic Healthcare’s experienced management team and employees, our equity partner Panasonic, and KKR all share a common goal of working together as partners over the long term to support further growth of Panasonic Healthcare. Japan is a very important and attractive market for KKR, and our experienced team on the ground in Japan looks forward to leveraging KKR’s global expertise and experience to make this a highly successful partnership.”

Panasonic Healthcare president Kenji Yamane said, “KKR has built long-term relationships with its portfolio companies around the world, and I amAir Max 90 Ultra Moire