SoftBank-owned Fortress left as sole bidder for Unizo after HIS bows out

FILE PHOTO: People walk past a retail shop of the SoftBank telecommunications company in Tokyo, Japan, May 10, 2016. REUTERS/Thomas Peter/File Photo

Japanese travel agency H.I.S. Co has given up its bid for a controlling stake in Unizo Holdings, Nikkei Business reported on Friday, after a SoftBank-owned firm made a $1.3 billion ‘white knight’ offer for the hotel operator.

Without citing sources, Nikkei Business said H.I.S. was abandoning the bid after deciding not to raise its offer price of 3,100 yen per share to buy another 40% of Unizo.

A representative for H.I.S., which owns 4.79% of Unizo and had planned to run its tender offer through Friday, was not immediately available for comment.

A Unizo spokeswoman declined to comment on the Nikkei Business report.

Unizo had rejected last month’s approach from H.I.S., which was valued at $390 mln, saying it was too low and lacked synergy.

It instead backed the friendly approach from SoftBank-owned Fortress Investment Group for the whole company a week ago at 4,000 yen per share.

The tug-of-war over Unizo has marked a stark departure from most acquisitions in Japan, where takeovers tend to be pre-agreed deals waiting to be rubber-stamped. Unwelcome bids, like that of H.I.S., are particularly rare.

H.I.S.’s exit would make Fortress the only bidder for Unizo but market participants said Fortress could be pressured by Unizo’s minority shareholders to raise its offer price.

Unizo shares rose 0.12% to 4,280 yen in morning trade on Friday, above the Fortress offer price. Shares of H.I.S. rose 4.67% to 2,646 yen.

U.S. hedge fund Elliott Management already holds a 9.9% stake in Unizo, while Japan’s Ichigo Asset Management has built its stake to 6.64%, according to public filings.

UBS has calculated Unizo’s net asset value – a measure of an entity’s net value – at more than 7,800 yen a share after taxes.

“The fate of Fortress’s bid all depends on how Unizo shares will perform going forward,” said a person familiar with the Fortress bid.

Elliott is known for buying stakes in companies in the midst of acquisitions and forcing better terms for minority shareholders.

Ichigo Asset said in the filing it acquired the stake to protect minority shareholders and it might make significant proposals to Unizo.

Reuters 

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.