REFILE-Advantage Partners, TPG to bid for failed Hayashibara-sources

(Corrects dateline to April 7 from April 8)

TOKYO, April 7 (Reuters) – Advantage Partners, TPG
and J-Will Partners are among those planning to bid for a
Japanese maker of the food sweetener trehalose, a deal that
could be worth as much as 40 billion yen ($467 million), three
people with direct knowledge of the deal said.

The company Hayashibara, which failed in February owing 130
billion yen in debt, has been looking for an investor to keep
its business going. It hired GCA Savvian Group as a
financial advisor.

Trading houses such as Mitsubishi Corp and Toyota
Tsusho Corp may also place bids, the people said,
adding that private equity firms and strategic investors could
team up.

The first round of bids will close on April 12, the people
said. The date was pushed back by a week after the March 11
earthquake and tsunami rattled financial markets, they said. The
people spoke on condition of anonymity as the bidding process is
not public.

The bidders are attracted to Hayashibara’s dominant position
in trehalose, the people said.

The company owns patents for technology to produce large
amount of trehalose at low cost and for using it in various
types of food and beverages.

Trehalose is used in frozen foods, beverages, beer, snacks
and confectionary.

Hayashibara is based in Okayama prefecture in western Japan,
an attractive location at a time when Japan’s business managers
are looking for ways to diversify geographical risk, the people
said.

Japan’s catastrophic March 11 earthquake and tsunami, which
triggered a nuclear safety crisis and rolling power blackouts,
have interrupted production at many factories in Japan,
prompting calls for companies to shift their production to
western Japan.

Hayashibara’s earnings before interest, tax, depreciation
and amortisation (EBITDA) was about 7 billion yen in the
business year ended October last year, and the company could be
worth as much as six times that, the people said.

Hayashibara also owns real estate assets, which have been
also put up for sale separately, the people said. Its assets
include Kyoto Century Hotel, a hotel located in front of Kyoto
Station.
($1 = 85.475 Japanese Yen)

(Reporting by Junko Fujita; Editing by Edwina Gibbs)

REFILE-Advantage Partners, TPG to bid for failed Hayashibara-sources