Japan's Cosmo calls another shareholder vote in activist defence (updated)

Cosmo Energy Holdings Co

24/10/2023 10:56

(Adds more details)
       TOKYO, Oct 24 (Reuters) - Cosmo Energy Holdings  5021.T 
said on Tuesday it would call another shareholder vote in
December to seek approval for a "poison pill" takeover defence
against a group of activist investors, escalating the
high-profile battle.
    Japan's third-biggest oil refiner, however, said it prevent
the group, led by prominent activist Yoshiaki Murakami, from
voting this time, unlike the previous vote in June, which had 
excluded the group's 20% voting rights.
    The tactics, a so-called "majority of minority" vote, has
fuelled concerns among governance experts, who argue that
practise undermines shareholder equality and could embolden
companies in Japan to hang on to much-criticised
cross-shareholdings as a defence against hostile takeovers.
    The June vote approved the use of a poison pill defence to
dilute the activists' stake if they buy more shares in Cosmo
without, for instance, stating the purpose of the purchase.
    In compliance with the procedures set by the company, the
group in July notified the company of its plans to boost its
stake to as much as 24.56% from 20.01%, arguing that management
entrenched itself and left shares of the company undervalued.
        Cosmo examined the plans and decided not to approve the
additional stake purchases by the group, citing the lack of
value-up strategies, as well as the group's investment patterns,
which it said had resulted in share price drops after the group 
sold its stake.
    But the company said it refrained from eliminating the group
from the vote, because the group this time was compliant with
the required procedures and clarified the size of the planned
purchases and the time frame.
        
  

 (Reporting by Makiko Yamazaki; Editing by Christian
Schmollinger & Simon Cameron-Moore)
 ((Makiko.Yamazaki@thomsonreuters.com; +81-3-4563-2805;))