Reports from various media outlets said that private equity firm KKR & Co was thinking of joining forces with an investment fund backed by the Japanese government for its planned bid for the healthcare unit of Panasonic Corp. The Wall Street Journal and Bloomberg both reported that by teaming up with a government private fund, KKR would be putting Japanese investors at ease with foreign buyout companies.

According to Reuters, foreign investment firms found securing deals in Japan a challenge. The pervading notion among Japanese investors was that they would reduce the workforce and strip companies of its assets to maximize their investments.

People familiar with the process, however, told Reuters that US-based KKR had not yet made any approach to government-backed Innovation Network Corp of Japan. The sources said that this alliance was just one of options for KKR. The sources added that the private equity firm had enough funds to buy the healthcare stake by itself.