The hedge fund TCI now says that it will wage a proxy contest among the shareholders of the Japanese electricity wholesaler J-Power, demanding higher dividends and a limit on cross-shareholdings.
Last month, TCI sought permission from the government of the country to raise its stake in J-Power to 20%. The government denied that request as I noted at the time, so the activist fund still has just below the 10% limit.
J-Power's annual meeting is set for June 26. TCI says that it plans to "expose serious conflict of interest of supplier and cross-shareholders" between now and then.
Cross-shareholding is a major corporate-governance issue that we haven't yet discussed on this blog. It refers to the practice whereby two corporations may hold shares in each other, therebvy entrenching the management of each against possible dissidents. The practice is quite common in Japan.
Should we stigmatize pressure upon Japanese countries of this sort, brought to bear by a London-based fund, as neo-imperialist? I don't see how that assists understanding, although those who wish may use the label at their pleasure. The world is getting to be a smaller place, and Japan of all countries knows the impossibility of autarky.
Showing posts with label J-Power. Show all posts
Showing posts with label J-Power. Show all posts
Wednesday, May 21, 2008
Wednesday, April 9, 2008
Three quick notes
1. Japan's trade minister, Akira Amari, wants to block the London-based hedge fund TCI from buying up to 20% of the equity in the country's leading electricity wholesaler.
TCI now owns 9.9% of the company, known informally as J-Power, because 10% is the cap beyond which acquisitions in certain industries deemed essential to national security require government approval in that country.
Mr. Amari said he doesn't believe his stand should be taken as any indication that Japan is closing itself to foreign investment. "J-Power is involved in a nuclear power plant project and operates power lines linking Japan's four major islands; all these could affect public order and daily life."
2. The annual meeting of Motorola this year will come off early next month without a proxy fight, now that the company has patched things up with investor Carl Icahn.
Icahn's taken a beating on MOT's stock price of late. His SEC filings indicate he's paid an average of $14.41 a share for the 144.56 million shares of the company he owns. The market price at the close of business yesterday was $9.49. So let's break out the calculator. A loss of $4.92 in the value of each share, times 144.56 million? that adds up to a loss of more than 711 million. Pretty soon, even for Icahn, you'll be talking real money.
Of course, that's only a paper loss. Icahn now has representatives on the board, and he hopes to introduce changes that will turn around the recent price slide.
3. SCSF Equities, a private-equity firm based in Boca Raton, Florida, now says that it wants to replace three of the members of the board of directors of Furniture Brands, of St. Louis, MO.
Their three nominees are: T. Scott King; Ira Kaplan; Alan Schwartz. Mr. King is the managing director of Sun Capital Partners Inc., which is the parent company of SCSF. Ira Kaplan is the barely-retired CFO of Claire's Stores Inc. The surprise in this list, the one that makes me sit up and take notice, is Alan Schwartz.
Schwartz is a distinguished academic student of corporate governance. He's been a professor at Yale University since 1987 -- teaching both at the law school and at the management school there. What's he doing in this fight?
We may try to figure that out together next week, fellow spectators. See ya Sunday.
TCI now owns 9.9% of the company, known informally as J-Power, because 10% is the cap beyond which acquisitions in certain industries deemed essential to national security require government approval in that country.
Mr. Amari said he doesn't believe his stand should be taken as any indication that Japan is closing itself to foreign investment. "J-Power is involved in a nuclear power plant project and operates power lines linking Japan's four major islands; all these could affect public order and daily life."
2. The annual meeting of Motorola this year will come off early next month without a proxy fight, now that the company has patched things up with investor Carl Icahn.
Icahn's taken a beating on MOT's stock price of late. His SEC filings indicate he's paid an average of $14.41 a share for the 144.56 million shares of the company he owns. The market price at the close of business yesterday was $9.49. So let's break out the calculator. A loss of $4.92 in the value of each share, times 144.56 million? that adds up to a loss of more than 711 million. Pretty soon, even for Icahn, you'll be talking real money.
Of course, that's only a paper loss. Icahn now has representatives on the board, and he hopes to introduce changes that will turn around the recent price slide.
3. SCSF Equities, a private-equity firm based in Boca Raton, Florida, now says that it wants to replace three of the members of the board of directors of Furniture Brands, of St. Louis, MO.
Their three nominees are: T. Scott King; Ira Kaplan; Alan Schwartz. Mr. King is the managing director of Sun Capital Partners Inc., which is the parent company of SCSF. Ira Kaplan is the barely-retired CFO of Claire's Stores Inc. The surprise in this list, the one that makes me sit up and take notice, is Alan Schwartz.
Schwartz is a distinguished academic student of corporate governance. He's been a professor at Yale University since 1987 -- teaching both at the law school and at the management school there. What's he doing in this fight?
We may try to figure that out together next week, fellow spectators. See ya Sunday.
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