Kohlberg Kravis Roberts has appointed turnaround specialist Hirofumi Hirano as chief executive of Japan, just as the country embarks on a major economic stimulus plan.
Hirano joins from AlixPartners Asia, a restructuring advisory firm, where he served as managing director and head of the region’s financial services practice. During his tenure, he led a team that advised on the turnaround of Japan Airlines.
Hirano takes the place of Shusaku Minoda, who has been promoted to chairman of KKR Japan. Both appointments take effect on April 15.
They follow KKR’s appointment last month of two new directors in Japan: Hiro Shimizu from Goldman Sachs and Sakae Suzuki from McKinsey & Company.
The latest executive moves by KKR, which oversees about $75 billion in AUM globally, comes as Japan kicks off its monetary stimulus plan, which will see an injection of $1.4 trillion into the local economy.
Buyout firms view the quantitative easing plan as one that would provide opportunities in a PE market that has been slumping.
Last year, there were 23 buyouts in Japan with $5 billion in total deal value – roughly half the 40 deals worth $10 billion in 2011, according to data from Mergermarket. Notably, however, foreign PE funds accounted for 64% of the deals by value in 2012, up from 50% the previous year.
Yet domestic state-backed entities have controversially stepped up to undertake a few large-cap turnaround deals, prompting the Japanese Private Equity Association (JPEA) to urge the government to reduce the role of taxpayer-supported funds in the buyout sector.
KKR last year attempted a $1.3 billion buyout of Renesas, a financially struggling Japanese chipmaker. It was outbid by state-backed fund Innovation Network Corporation of Japan, which acquired two-thirds of the company for $1.5 billion.
The JPEA – whose membership includes global funds KKR, Bain Capital and Carlyle Group – contends that state-owned entities would pursue a softer restructuring than outside investors, potentially allowing companies to push back problems and retain idle assets.
The Japanese government has not yet responded to JPEA's assertions.