Watami, the Japanese izakaya and meal-delivery group, agreed on Friday to be taken private by a company controlled by its founder, Miki Watanabe, in a tender offer priced at 1,284 yen a share. The price is a 49.65% premium to the stock's Nov. 12 close of 858 yen, according to filings with the Tokyo Stock Exchange.

The bid vehicle, Wisdom Co., is seeking 24,931,077 shares, which at the offer price comes to about 32 billion yen. The offer runs from Nov. 16 to Dec. 28, with settlement on Jan. 6. Watami's board backed the deal and recommended that shareholders tender, and the company plans to leave the Prime market of the Tokyo exchange once the process is complete.

For investors in Asia, the deal is the latest in a steady stream of Japanese companies choosing to delist rather than answer to public shareholders. It came in a week when two of the country's largest homebuilders also launched tender offers for smaller listed builders, adding to a run of domestic consolidation that includes Mitsubishi Logistics' move for Hankyu Hanshin Express.

How the Watami Buyout Is Structured

Wisdom was set up on Oct. 2 for the deal. It is wholly owned by Keniten, an asset-management company owned by Watanabe, who is chairman, president and CEO of Watami, and by Masaya Watanabe, a board member and managing executive officer. Keniten already holds 28.57% of Watami, and Watanabe will stay on as chief executive after the deal, the filings said.

Keniten agreed not to tender the 24.33% of Watami it holds directly. Suntory, Watami's second-largest shareholder with 13.52%, also agreed not to sell. Instead, the beverage company will swap its Watami shares for class shares in Wisdom through a share exchange planned for around June 2027, keeping it invested in the private company.

The offer needs at least 11,545,500 shares to succeed, and there is no cap. Wisdom will pay with loans from Bank of Yokohama and Sumitomo Mitsui Banking Corp., to be drawn after the offer succeeds, with the Watami shares it buys pledged as collateral, according to Watami's statement. If the offer clears, Watami plans a share consolidation to squeeze out remaining holders.

Shareholders who stay in until the end will lose two things. Watami said it would pay no year-end dividend for the fiscal year ending March 2027, against 10 yen a share paid for the previous year, and it will scrap its shareholder perks program. The final perks will go to holders on record as of Sept. 30.

Eight Offers Before the Board Said Yes

The price was negotiated in small steps. Wisdom first proposed 1,079 yen on Oct. 14, a 26.49% premium at the time, according to Watami's statement. A special committee set up to review the deal pushed back, and Wisdom raised its offer to 1,156 yen, then 1,217, 1,264, 1,270, 1,281 and 1,283 yen before settling at 1,284 yen in an eighth proposal on Nov. 12.

The final price is about 40% above Watami's six-month average closing price of 915 yen. Wisdom bought 100 shares from a Watami employee on Nov. 13 at 858 yen, which the filing said was done so that it could request access to the shareholder register.

Jiji Press reported on Friday that greater management freedom would help Watami reduce its reliance on izakaya pubs, as fewer Japanese consumers, young people in particular, drink alcohol. Watami has diversified for years. It took over the Japanese operations of the Subway sandwich chain under a master franchise agreement in October 2024 and runs a boxed meal delivery service.

Sekisui House and Asahi Kasei Homes Bid for Smaller Builders

Two homebuilding groups announced bids for listed partners in the same two days.

Sekisui House said on Nov. 13 that it would offer 2,770 yen a share for Gifu Zoen, a landscaping and exterior-works company listed in Tokyo and Nagoya in which it already owns 20%. The price is a 39.48% premium to the Nov. 12 close of 1,986 yen. The offer runs from Nov. 16 to Jan. 13, and it succeeds only if shares equal to at least 46.67% of Gifu Zoen are tendered. Gifu Zoen's board backed the bid.

A day earlier, Asahi Kasei Homes, part of the Asahi Kasei chemicals group, launched a 564-yen-a-share offer for Mori-Gumi, a construction company in which it has held 30.26% since buying the stake from Haseko and Hankyu Corp. at 222 yen a share in 2016. The price is a 79.05% premium to Mori-Gumi's Nov. 11 close of 315 yen. Haseko, which still owns 8.01%, has agreed to tender. The offer runs to Jan. 7, and the minimum acceptance level is 11,922,100 shares, or 36.40% of the company.

In each case the buyer was already the largest or a major shareholder, and the premiums were large relative to small, thinly traded stocks. Gifu Zoen and Mori-Gumi both trade on the Standard market.

Watami's tender offer registration statement is due on Nov. 16, the first day of the offer. The deal closes on Dec. 28 unless Wisdom extends it, and the share exchange with Suntory is planned for around June 2027.