Japanese hotel operator Unizo Holdings withdrew its support for a $1.3 billion takeover bid by a SoftBank–backed fund, saying it wanted better terms, just a month after it welcomed the “white knight” buyout offer.
The company also said it had received a separate offer from an unnamed third party which it had rejected as insufficient.
Unizo‘s about-face appears to heighten the possibility that SoftBank-owned Fortress Investment Group will have to hike its offer price. It also marks another twist in a deal that began with a rare hostile bid and has drawn in U.S. hedge fund Elliott Management.
“The board of directors has rescinded our previous opinion … and has voted to withhold our opinion on whether or not to recommend tendering shares,” Unizo said on Friday.
Fortress last month offered 4,000 yen ($37) a share for Unizo, trumping an earlier bid from travel agency H.I.S. Co that had made a rare hostile offer for the company at 3,100 yen a share.
Unizo said on Friday Fortress had not fulfilled its demands including raising the price to 5,000 yen or met its concerns about employment and working conditions of current employees.
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 from H.I.S., are particularly rare.
Following’s H.I.S.’ exit last month, market participants had said Fortress could be pressured by Unizo‘s minority shareholders to raise its offer price.
U.S. hedge fund Elliot Management holds around 11% of Unizo, while Japan’s Ichigo Asset Management owns at least 6.6% according to recent filings.
Shares of Unizo finished up 0.9% at 4,510 yen, above Fortress‘ offer price.