Japan’s JAFCO weighs takeover defense against activist

TOKYO, Aug 15 (Reuters) – JAFCO Group Co Ltd (8595.T) said on Monday it may introduce a “poison pill” defense after a group of shareholders backed by a prominent activist investor “left hear” that he might buy a majority stake in the major Japanese venture capital firm.

A group of investors led by Yoshiaki Murakami told JAFCO in meetings earlier this month that they had amassed nearly 15% of their shares and suggested there was scope to increase their stake to 51%, a the company said in a regulatory filing.

The Murakami Group also asked JAFCO to buy back shares worth about 50 billion yen ($374.76 million), or one-third of its market value, according to the filing.

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A representative of the group’s main fund, which is called City Index Eleventh, declined to comment when contacted by Reuters and asked about a possible increase in its stake to 51%.

Faced with the threat of a takeover, JAFCO’s board decided on Monday to introduce countermeasures, including an option to issue stock warrants to existing shareholders, which would dilute the interest held by parties related to Murakami, when the required conditions are met.

A poison pill that targets a specific bidder – called an emergency poison pill in Japan – was first used successfully in 2020 by Toshiba Machine, renamed Shibaura Machine, in its fight against Murakami.

($1 = 133.4200 yen)

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Reporting by Makiko Yamazaki; edited by Jason Neely

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