Japan's Cosmo braces for 'poison pill' anti-activist vote

Cosmo Energy Holdings Co

10/11/2023 11:54

By Makiko Yamazaki and Yuka Obayashi
       TOKYO, Nov 10 (Reuters) - Japan's Cosmo Energy Holdings
 5021.T  could struggle to win shareholder backing for a revised
"poison pill" strategy, its chief executive said on Friday, as
the company seeks to defend itself from activist investors
pursuing a hostile takeover.
    Japan's third-biggest oil refiner is calling another
shareholder vote on Dec. 14 to seek approval to discourage
activist group, led by Yoshiaki Murakami, from increasing its
stake to 24.56% from current 20%.
    "We are fighting against heavy odds, as we know that certain
investors flatly oppose any takeover defence," CEO Shigeru
Yamada told Reuters in an interview.
    Cosmo has for more than a year been trying to fight off
Murakami.
    In June, a previous vote on a poison pill to dilute the
activists' stake if they buy more shares without following set
procedures succeeded.
    The upcoming vote is whether to block further purchases by
the activists even when they comply with the set procedures.
    Yamada said the company decided against adopting the tactic
agreed in June, known as "a majority of minority vote", because
its use could detract from the fundamental question of who would
be best suited to increasing the value of the company.
    "We want to ask shareholders whose plans can boost the
shareholder value, ours or Murakami-san?" he said.
    Yamada said the Murakami group does not have a concrete
management strategy to improve Cosmo's corporate value.
    The group, which says Cosmo's shares are undervalued, has
floated ideas such as consolidating refineries and selling off
the oil and gas development unit.
    Yamada said refineries and oil and gas development were the
companies core business until around 2030 and consolidation or
selling them would undermine shareholders' interests.

 (Reporting by Makiko Yamazaki and Yuka Obayashi; editing by
Barbara Lewis)
 ((Makiko.Yamazaki@thomsonreuters.com; +81-3-4563-2805;))