Easier path for foreign investors

対日直接投資の
促進策

    Under current laws, buying out a company is a costly undertaking that requires purchasing a large amount of its stock. The proposed legislation, which is expected to take effect in 2006, will eliminate the need to achieve buyouts through equity swaps between the acquiring company and the company to be acquired. This rule will apply to Japanese and foreign interests.

    The government welcomes direct investment from abroad. Japanese corporate managers, however, are worried that lower barriers to buyouts could make their companies easy takeover targets for giant foreign companies or investment groups. A takeover bid may be difficult to deter, they say, if the market capitalization (share price multiplied by the number of shares) of a target corporation is relatively small.

    Last year, a U.S. buyout fund called Steal Partners spooked the Japanese stock market by mounting a takeover bid for Yushiro Chemical Industry Co., the producer of metalworking oil agents. The company, listed on the Tokyo Stock Exchange, fended off the bid by sharply increasing its payout of dividends — a move intended to make a takeover less attractive to the would-be acquirer.

    A takeover bid is either friendly or unfriendly. The attempt by the U.S. fund was friendly, meaning that it was not aimed at a changeover in management. Nevertheless, the move came as a shock because a huge amount of stock was purchased in an unusual manner.

    Companies of lower market value could be easy targets of foreign acquisitions because the traditional defense against takeovers — the existence of stable long-term corporate shareholders under the cross-shareholding system — has all but collapsed. An immediate line of defense may be to raise stock prices, but that's easier said than done.

    Some companies are trying to stave off foreign buyouts through mergers with Japanese partners. For example, two drug companies, Yamanouchi and Fujisawa, are set to merge in April. But a merger is no sure guarantee against a foreign takeover. For one thing, the two firms' combined market capitalization is only about one-tenth the market value of Pfizer Inc., a major U.S. drug company.

    Concerns about hostile takeovers may be a little exaggerated, according to Japanese buyout agents, because such forceful acquisitions are not amenable to Japan's consensual corporate culture. The important thing is to "polish up the competitive edge of the company." Thus they advise Japanese businesses to make steady efforts to improve themselves on a long-term basis, rather than resorting to makeshift measures. Still, with international takeover artists looking for attractive targets, fears of unfriendly buyouts remain deep.

    Some companies are reportedly studying a more drastic deterrent: the so-called "poison pill," a contractual clause that enables existing shareholders to buy newly issued shares at a price lower than market value and redeem them at a premium price after a takeover. This makes an acquisition more expensive and therefore less attractive to a bidder. This measure is a common practice in the United States, but in Japan it is more a theoretical curiosity than a practical option.

    That aside, it is worth noting that hostile takeovers can serve constructive purposes. A good number of buyers — either companies or investors — appear motivated to remake target companies by replacing their inefficient management and reviving their sluggish stock prices. "Good" hostile takeovers can turn around failing companies.

    It is said that stocks of listed Japanese companies are often undervalued compared with their actual profit performance. This can be taken as evidence that such companies are not adequately rewarding their shareholders or taking good care of their interests. If so, management will likely face the prospect of a changeover through third-party acquisition. That should be welcome at a time when corporate vitality is badly needed.

The Japan Times Weekly
Jan. 15, 2005
(C) All rights reserved

      現行法では、企業買収には大量の株式を購入するための多額の資金が必要になる。06年に成立予定の法案では、買収にあたり買収企業と被買収企業間の株式交換の必要がなくなる。

      政府は海外企業の直接投資を歓迎しているが、日本企業側は、外国企業や投資グループの買収の格好の標的になることを心配している。

      昨年、米国系ファンド、スチール・パートナーズはユシロ化学工業に対しTOB（公開買付け）攻撃をかけたが、ユシロは株主への大幅増配で対抗した。

      TOBには友好的、敵対的の二種がある。スチール・パートナーズによるTOBは、友好的のなものであったが、大量の株式買付けは衝撃的であった。

      国内企業間の合併によって外国企業による買収を避けようとする動きがあるが、合併は買収を抑止することにはならない。例えば、山之内製薬は藤沢薬品工業と4月に合併を予定しているが、両社の合計株式時価総額は米ファイザー社1社の株式時価総額の10分の1にしかならない。

      企業買収関係者は、外国企業による敵対的TOBに対する不安は誇張されているきらいがあるというが、不安は消えない。一部の企業はTOB攻撃防止のために、現存の株主に市場価格よりも安い価格で新株を提供し、買収完了後高値で償還する方式を検討している。買収企業側にはより多くの資金が必要になり、メリットが少なくなる。

      敵対的TOBも建設的目的に使える。外国企業、ファンドは国内企業の非効率な経営陣の退陣による株価回復を狙っている。「よい」敵対的TOBは経営不振企業の再建につながる可能性がある。

      国内上場企業の株価は収益に比べ低すぎるといわれる。株主優遇策が十分でないとすれば、企業買収による経営陣の交代は、企業の活性化が必要とされるときに歓迎すべきである。