Head of Japan's Lixil bows to investor pressure in boardroom drama
18/04/2019 13:56
By Junko Fujita
TOKYO, April 18 (Reuters) - Japanese toilet maker Lixil
Group's 5938.T CEO is to resign next month, marking a rare
victory for activist minority shareholders who had demanded that
he step down.
Yoichiro Ushioda's plan to resign, announced on Thursday,
could be a signal that vocal minority shareholders are becoming
more successful in changing the management of Japanese companies
following Prime Minister Shinzo Abe's efforts to strengthen
corporate governance.
Ushioda's move follows a boardroom drama that has been
unusually fractious, at least by the standards of corporate
Japan.
Ushioda, who hails from one of the company's founding
families, said he was resigning as chief executive and chairman
of the board.
This followed Lixil's statement that it would fall to a
full-year net loss of 53 billion yen ($4734 million) in the year
that ended in March, from its previous forecast of a slight
profit.
Four investment firms last month had called for Ushioda to
leave the company's board along with the company's chief
operating officer, Hirokazu Yamanashi. The investors said their
appointment last year after the previous CEO Kinya Seto's abrupt
resignation raised concerns about due diligence and corporate
governance. urn:newsml:reuters.com:*:nL3N2172OU
The shareholders - Marathon Asset Management, Indus Capital
Partners, Polar Capital Holdings Plc POLR.L and Taiyo Pacific
Partners LP - had called for an extraordinary shareholders'
meeting to vote out Ushioda and Yamanashi from the board, saying
the two should also consider resigning from their management
positions.
Lixil has said the meeting would be held in the latter half
of May, adding on Thursday that Ushioda and Yamanashi had
requested that to be halted.
Lixil was created in 2011 through a merger of five building
materials and housing companies, including Tostem and Inax.
As of September, 38 percent of Lixil's shareholders were
foreign institutions while 7.2 percent of the company was held
by Japanese institutions, it said last month.
($1 = 111.9100 yen)
(Reporting by Junko Fujita; Editing by David Dolan and Jane
Merriman)
((813-6441-1840, junko.fujita@thomsonreuters.com, Reuters
Messaging:junko.fujita.reuters.com@reuters.net;))