Hostile takeover tests Japanese love for free food
27/07/2020 03:45
(The author is a Reuters Breakingviews columnist. The opinions
expressed are her own.)
By Sharon Lam
HONG KONG, July 27 (Reuters Breakingviews) - Restaurant
chain Ootoya rejected a bid from Colowide, saying it would spoil
its home-style ethos. The company is hoping its retail investors
will remain loyal to the dining coupons they get for holding
shares. They would be better off taking the 46% premium, and
dining elsewhere.
Full view will be published shortly.
On Twitter https://twitter.com/sharonlamhk
CONTEXT NEWS
- Japanese restaurant chain Ootoya, which operates eateries
specialising in home-style cooking, said its board is opposed to
a takeover from top shareholder Colowide, Reuters reported on
July 20. Colowide, which runs various restaurant brands using a
centralised kitchen system, offered in July to buy Ootoya at
3,081 yen per share in a deal that would boost its stake in the
company to 51.3% from 19.2%. That price marks a 46% premium to
the undisturbed price on July 8.
- Shares in Ootoya closed at 2,954 yen on July 22, 4% below
the offer price.
- At 3,081 yen a share, the tender offer values Ootoya’s
equity at around 22 billion yen, or about $211 million.
- The offer deadline is August 25.
- “There would be no future if Ootoya is taken over by
Colowide,” Ootoya President Kenichi Kubota said at a media
briefing on July 20. He said the company is not planning to take
any measures to counter the bid, and has asked shareholders not
to tender their shares to Colowide.
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Japan's Ootoya's board opposes Colowide's bid urn:newsml:reuters.com:*:nL3N2ER24M
BREAKINGVIEWS-Japanese investors stick to curious old ways
urn:newsml:reuters.com:*:nL4N2BK1U0
BREAKINGVIEWS-Japanese hospitality has a long way to go in M&A
urn:newsml:reuters.com:*:nL4N2C80IL
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(Editing by Pete Sweeney and Jamie Lo)
((sharon.lam@thomsonreuters.com; Reuters Messaging:
sharon.lam.thomsonreuters.com@reuters.net))