Private Equity Fund Reportedly Plans to Buy Majority Stake in Japan Major Crypto Exchange

A Japanese, Singapore-based private equity fund is allegedly set to buy a controlling stake in bitFlyer, Japan’s major crypto exchange.

Per Nikkei and CoinPost, the move has been made by the ACA Group, which has agreed on a deal with a coalition of shareholders of the firm bitFlyer Holdings. The latter owns the lion’s portion of the platform’s shares.

The deal will reportedly cost ACA some USD 370 million, and Nikkei added that ACA plans to “eventually sell bitFlyer” after boosting its corporate value.

BitFlyer, however, was quoted as telling Nikkei that “nothing has yet been decided.”

But a seemingly acrimonious split between Yuzo Kano, bitFlyer’s Founder and CEO and other shareholders may have soured the process. 

The media outlets noted that Kano, one of the leading figures in the Japanese crypto sector had been attempting to broker a sale. The CEO owns some 40% of the firm and had “been negotiating a sale on his own” – speaking to the likes of Huobi and the e-commerce platform Mercari about a deal. Kano reportedly values the exchange at just over USD 815 million.

CoinPost quoted Kano as stating he “did not know anything” about the ACA deal.

Kano had reportedly spoken of a “hostile takeover” attempt on his social media pages, CoinPost noted, but it seems that other shareholders have spoken to ACA independently, with Nikkei writing: “A group of bitFlyer Holdings shareholders, including venture capital investors, took charge of the sale negotiations.”

The coalition appears to have won the support of Co-Founder Minefumi Komiyama, who owns some 13% of the exchange. Crucially, the domestic housebuilding giant Sekisui House, which also has a 13% stake, is “expected to participate” in the deal, which will reportedly see “just over 50%” of shares transferred to ACA. This would effectively leave Kano as a powerful minority shareholder, but no longer in charge of company’s destiny.

Nikkei noted, however, that it was “still possible that Kano” could “join the sale.”

The shareholders group, the media outlet added, appears keen to “recoup its investments quickly” and had decided against pressing for a listing on a stock market. Japanese securities laws do not allow crypto-related firms to list, and an overseas listing was seen as time-consuming.

bitFlyer was founded in 2014, and per figures released last year had almost USD 4.7 billion worth of fiat and crypto in its custody.

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