Japanese-based LIXIL Corp. has formed a 50-50 joint venture with the state-backed Development Bank of Japan to buy 87.5% of GROHE Group from TPG and DLJ Merchant Banking Partners. This transaction represents the largest ever German investment by a Japanese company. The combined sanitary businesses of both groups generate more than EUR 4 billion of annual revenue, making it the largest player in its industry.
GROHE and its subsidiary Joyou remain independent within LIXIL Corp. GROHE will continue to implement its plan for long-term sustainable growth, including becoming a leading consolidator in the global sanitary industry.
Chief Executive Officer of GROHE David J. Haines will remain in this position and has signed a new five-year contract. LIXIL and Development Bank of Japan will have seats on the supervisory board of the holding company of GROHE Group S.à.r.l. in Luxemburg.
“For GROHE and Joyou, LIXIL is a perfect match,” said Haines. “It is currently building a strong track record as a global leader in the building materials and housing equipment industry. As a growth-oriented company, LIXIL has always been the preferred partner to support us with our growth strategy, especially in emerging markets.
For Joyou in particular, this new partnership will be of enormous benefit, as our ability to grow and strengthen the brand in the Asia-Pacific region will be enhanced.”
“GROHE is one of the most well-known brands in the global sanitary market,” said LIXIL President Yoshiaki Fujimori. “In addition to its high standards for quality, GROHE has received high acclaim globally for its leading product design and innovation. We have great respect for what CEO David Haines and his management team have achieved — bringing GROHE into the LIXIL family allows us to make further progress in building the leading platform in the global sanitary industry whilst also strengthening our distribution network in Asia.”
The transaction is expected to close in Q1 2014.