Summit Notebook

Exclusive outtakes from industry leaders

Japan eyes UK takeover rules

July 7, 2009

Japan’s takeover rules are destined to be shaken up — but probably not for some time.

The government wants to adopt Britain’s takeover rules rather than base policy on the U.S. model.

Hiroaki Niihara, director of the corporate system division at the Ministry of Economy, Trade & Industry, told the Reuters Japan Investment Summit that current rules make it too easy to defend against approaches and are bad news for minority shareholders.

A “poison pill” takeover defence by Bull-Dog Sauce Co in 2007 showed up shortcomings, he said.

But change will take time. METI has been in talks with Britain’s Takeover Panel, the body that oversees Britain’s takeover policies, whose members are market practioners.

The Panel recently delivered 10 boxes of documents detailing how its oversight works to versight to METI, and getting to grips with the system is just the start of the process of change.

Niihara said he expects institutional investors — many of them with links to Japanese conglomerates — to oppose the plan. “I expect very strong resistance on their part,” he says.

Photo credit: REUTERS/Yuriko Nakao

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