Selling Intelligence to KKR — the run of subsidiary disposals (2010)

Sell in order of what fetches a price, and see what is left

There is little trace, in this sale, of a business having been chosen. The reasons set out in the securities report were concentration on music broadcasting and reduction of interest-bearing debt — and it states that the synergies were large while letting the business go. If you convert into cash, in order, the assets for which a buyer appears and a meaningful price can be had, what remains is what carries no price. At USEN in 2010, the asset for which no buyer appeared to the last was the streaming business, U-NEXT.

Set out in figures, the gap is extreme. The sale price of the Intelligence shares was ¥31.798 billion; the price of the 200 U-NEXT shares Uno Yasuhide bought from USEN in December of the same year was ¥10 million. That ¥10 million company listed on the TSE Mothers market in December 2014, and in December 2017 absorbed USEN — its seller — to become the surviving entity of the holding company. The price tag on a sale was no more than a copy of how a buyer valued the thing at that moment.