Oasis could pursue appraisal rights in $2.7 bln Itochu unit buyout (updated)

Itochu Techno-Solutions

16/11/2023 04:35

(Adds Oasis comments in paragraphs 4-5, 7 and 11, Alps Alpine
lawsuit in paragraphs 8-10)
    By Makiko Yamazaki
       TOKYO, Nov 16 (Reuters) - Hong Kong-based Oasis
Management could go to court to seek a higher price for trading
house Itochu's  8001.T  $2.7 billion acquisition of a subsidiary
through a so-called appraisal process, the founder of the
activist fund said Thursday.
    Oasis emerged as a major shareholder with a 6.42% stake in
Itochu Techno-Solutions (CTC)  4739.T  after Itochu completed a
tender offer that raised the parent's stake from 61.24% to about
86%. Itochu plans to take CTC private in December. 
    The appraisal process is designed to protect investors who
oppose a buyout by allowing them to ask a judge to determine
fair value of a stock. 
    "We do have rights to pursue when transactions are not fair,
including pursuing our appraisal rights, so we most likely will
proceed that way," Seth Fischer, Oasis founder and chief
investment officer, told reporters. 
    "I understand the benefits of the merger, but those benefits
belong to all shareholders, not just Itochu," he said, arguing
that Itochu's offer price failed to factor in the full benefits
of its absorption of CTC. 
    Itochu offered to pay 4,325 yen per CTC share, an 18.7%
premium over the closing price from the day before the tender
offer was announced on Aug. 2. 
    Fischer said there is "a lot more to be done" to hold buyers
accountable and protect minority shareholders. 
    In another fight for higher value, Oasis last month appealed
to the Supreme Court to nullify the merger that formed Alps
Alpine  6770.T  after losing in lower courts, arguing the merger
ratio was unfair to Alpine shareholders. 
    Alps Alpine was created in 2019 when Alps, which had owned
40% in car navigation systems maker Alpine, bought the remaining
Alpine shares through share swaps. 
    Oasis, the No.2 shareholder with a 9.9% stake Alpine at the
time, had opposed the merger. 
    The Alpine case is "very important" in terms of setting a
precedent in finding an appropriate price, Fischer said.

 (Reporting by Makiko Yamazaki; Editing by David Dolan)
 ((Makiko.Yamazaki@thomsonreuters.com; +81-3-4563-2805;))