Toshiba According to a survey allegedly requesting the Ministry of Trade to “defeat” hedge funds, the Japanese government colluded and asked foreign investors to support corporate management with important votes.
A shareholder consignment report released Thursday also said that Yoshihide Suga, then Chief Cabinet Secretary and now Prime Minister, verbally encouraged investor pressure in a meeting with Toshiba executives last year. , Mr. Suga denied the claim.
Toshiba is strategically important to Tokyo as a manufacturer of nuclear reactors and defense equipment. The results of the survey have revolutionized the long-term battle between Japanese corporate executives and foreign shareholders, including activist investors and Harvard University donation funds.
According to a report written by an independent investigator, Toshiba’s management sought help from the Ministry of Economy, Trade and Industry (METI) before its annual meeting in July last year to compete with activist investors.
According to the survey, management “closely works” with the ministry to “unreasonably influence some shareholders,” including attempts to force Efficimo Capital Management to withdraw candidate nominations. did.
Effissimo, Singapore-based Toshiba’s largest shareholder, has nominated three candidates, including its co-founder, as directors. I wasn’t chosen after all.
An executive said, “I’ll ask the Ministry of Economy, Trade and Industry to beat them for a while,” detailing an email sent to Toshiba’s top executives about Effissimo.
The Ministry of Economy, Trade and Industry, which was contacted by Reuters, said it was aware of the report and was investigating its contents. Toshiba said it would “carefully consider” the report and comment at a later date.
A spokeswoman for Effissimo said he was considering the report, but declined to comment further.
Suga seen under a microscope
Once a treasure trove of Japanese companies, Toshiba was hit by an accounting scandal dating back to 2015 and suffered a major write-down on the sale of its US nuclear power business and semiconductor units, leaving behind its former appearance.
The report has been entrusted by shareholders, who voted in March to conduct an independent investigation into allegations that investors were under pressure from the company. It was considered a turning point in activism.
Investigators also claim that Mr. Suga helped put pressure on Toshiba investors at a breakfast party with executives last July.
Mr. Suga mentioned the rules that were introduced in 2020 and were designed to protect industries that are important to Japan’s national security. You can do it. “
Asked about the alleged comments, SUGA told reporters: There was nothing like that. “
The alleged intervention by the Ministry of Economy, Trade and Industry, previously reported by Reuters, is likely to question Japan’s commitment to improving governance and attracting foreign investors, the goals set by former Prime Minister Shinzo Abe.
As a result of the investigation, Toshiba has overpowered Effissimo, Harvard Fund and another fund, 3D Investment Partners, to “effectively prevent shareholders from exercising shareholder proposals and voting rights. I devised a plan. “
The ministry is said to have contacted Singapore-based 3D and warned that “in the event of a major fire, we will barbecue next to our neighbors.”
A Harvard spokeswoman declined to comment, but 3D did not immediately respond to the request for comment.
According to the report, some actions have caused “suspected violations of laws and regulations in many places,” the report said. Investigators later said at a news conference that the breach could include bureaucratic confidentiality.
“Grow a hornet’s nest”
“The conclusions and facts of this report are very alarming,” said Nicholas Benesse, director of the non-profit Japan Board of Directors Training Association.
“This report raises a hornet-like question. Will an EGM (Extraordinary General Assembly) be convened to re-election the board? Will the directors be sued? Toshiba will also be listed. Will it be abolished? “
Following the 2017 funding, many foreign funds have invested in Toshiba, creating volatile marriages with activist investors and key strategic assets.
Reuters previously reported that https://jp.reuters.com/article/toshiba-board-idCNL1N2J4052Harvard’s donation fund was provided by the regulatory authority if the fund was not approved by Hiromichi Mizuno, then an adviser to the Ministry of Economy, Trade and Industry. He reported that he was informed that he might be investigated. Follow management recommendations at AGM last July.
The Harvard Fund eventually abstained from voting.
Based on the Reuters report, Toshiba’s board of directors began its own investigation in January of this year to see if Harvard University was under pressure, investigators said. Toshiba said it was not involved in the pressure efforts on Harvard University at the time.
Since then, former CEO Nobuaki Kurumatani has resigned from Toshiba, and the subsequent turmoil has led to a $ 20 billion bid from CVC Capital to the conglomerate.
Toshiba sources said the CVC proposal to keep the Japanese conglomerate private and retain its current management team was recognized by some within the company as being designed to protect Kuratani from activist shareholders. Said.
Toshiba rejected the bid, but announced that it would make a strategic review.
Activist investors are estimated to account for about 25% of Toshiba’s shareholder base.The company was on the verge of bankruptcy in 2017 and must quickly issue approximately $ 5.5 billion worth of shares. It was an unusual rate because it didn’t.
Is Toshiba and Japan Colluding with Foreign Investors? Survey Results-SABC News
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