Japan activist investor Murakami makes hostile bid for ex-Toshiba unit (updated)

Shibaura Machine

21/01/2020 02:38

(Adds bid details, Toshiba Machine comment, background on
Toshiba and Murakami)
    By Makiko Yamazaki
    TOKYO, Jan 21 (Reuters) - A fund backed by Japan's most
prominent activist investor said it will launch on Tuesday an up
to $235 million takeover bid for Toshiba Machine Co Ltd
 6104.T , even though the former Toshiba Corp  6502.T  unit has
threatened to implement defence measures.
    Hostile bids are rare in Japan but have been increasing as
the government promotes corporate governance reform to make
management more accountable to investors.
    City Index Eleventh Co, backed by veteran activist investor
Yoshiaki Murakami, said it would offer 3,456 yen per Toshiba
Machine share to buy up to 43.82% of the molding machine maker,
spending up to 25.9 billion yen ($235 million).
    The offer price represents an 11% premium over Toshiba
Machine's close on Friday, when the company revealed the
Murakami fund group's buyout plans. The shares plunged 9% on
Tuesday after shooting up 19% on Monday.  urn:newsml:reuters.com:*:nL4N29M3MU
    Toshiba Machine late on Friday said it could adopt
poison-pill measures to fend off acquisition attempts by
diluting the holdings of unwanted suitors.
    It added that the planned takeover bid could potentially
hurt the maximisation of its corporate value and shareholders'
interests.
    A Toshiba Machine spokesman said on Tuesday the firm is
examining the tender offer.
    City Index Eleventh in a statement said poison pill measures
would buck corporate governance progress in Japan and have a
significantly negative impact on market participants.
    Murakami-related funds currently hold a combined 11.49% of
Toshiba Machine's total voting rights.
    A former bureaucrat, Murakami famously led a fund targeting
Japanese companies and pushing for greater shareholder returns
until he was convicted of insider trading in 2007. He has since
resurfaced as an investor, working with his daughter.
    Toshiba Corp holds less than 3% of Toshiba Machine, having
sold the bulk of its stake during a management crisis in 2017.
    ($1 = 110.1900 yen)

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Japan activist investor Murakami eyes takeover of former Toshiba
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 (Reporting by Makiko Yamazaki and Kiyoshi Takenaka; Editing by
Himani Sarkar and Christopher Cushing)
 ((kiyoshi.takenaka@thomsonreuters.com; +81 3 4563 2788;))