Reuters: Bain to Sell Majority Stake in Domino’s Pizza Japan

(Reuters) – U.S. private equity firm Bain Capital has agreed to sell a majority stake in the Japan franchisee of Domino’s Pizza to Australia’s Domino’s Pizza Enterprises Ltd for 12 billion yen ($124 million).

Bain, one of the largest private equity firms operating in Japan, will keep a 25 percent stake in Domino’s Pizza Japan, believing in its growth potential, David Gross-Loh, a managing director at Bain Capital Partners LLC told Reuters in an interview.

The franchisee has 259 stores and wants to boost that number to 600.

The restaurant sector is one of the few areas where private equity has found success in Japan.

“The retail and restaurant sector is rife with founder-owned businesses that can be acquired and taken to a next level,” said Gross-Loh.

Unlike tech and industrial firms owned by large corporations that take a long time to decide about divesting their divisions, founder-owned businesses need successors, giving rise to private equity opportunities, he said.

Last year, Japanese buyout firm Unison Capital sold sushi restaurant chain Akindo Sushiro Co Ltd for around $1 billion to European private equity firm Permira in one of the largest transactions involving buyout firms in Japan.

This year, another Japanese private equity firm Advantage Partners sold its stake in coffee shop chain Komeda to MBK Partners for an undisclosed amount.