Toyo to stick to shareholder returns policy after top investor's bid withdrawal (updated)
21/12/2023 03:48
(Recasts with Toyo exec interview)
By Makiko Yamazaki and Mariko Katsumura
TOKYO, Dec 21 (Reuters) -
Japan's Toyo Construction 1890.T will stick to its plans
to sharply boost shareholder returns, an executive said on
Thursday, after the marine construction firm's top investor
withdrew a takeover offer, sending shares down sharply.
Yamauchi-No.10 Family Office (YFO), the family office
linked to Nintendo's 7974.T founder, which has a 28.51% stake
in Toyo, said on Wednesday it would end its bid for Toyo after
the company pushed back the buyout proposal, citing a lack of
specifics in its business strategy.
Toyo shares sank more than 10% briefly in morning trade
on Thursday.
"The share reaction was expected, but we assure that we
are determined to achieve our financial targets with no changes
to our plans for shareholder returns," Toyo chief executive
Manabu Tokita said in an interview with Reuters.
Toyo's opposition to the buyout offer was a surprise to
some investors, as a majority of the Toyo board now consists of
YFO-backed directors after the investment fund
reshuffled the
board, which resisted its offer in June.
During a proxy fight in the run-up to the June
shareholder meeting, Toyo promised to sharply boost shareholder
returns in the next five years.
Tokita noted that the YFO-led board reshuffle resulted
in a sharp improvement in the company's governance, including
changes to management and board structure. YFO-backed directors
"helped bring in insights from outside the company, and we do
feel positive progress has been made", he said.
YFO said in its statement on Wednesday that it hadn't
decided whether to make a fresh proposal or what to do with its
stake in Toyo.
Asked about the possibility of buying back its shares
from FYO, Toyo's Tokita said nothing has been decided.
(Reporting by Mariko Katsumura; Editing by Christopher Cushing
and Gerry Doyle)
((Mariko.Katsumura@thomsonreuters.com;))