shareholder to unload $1 billion worth of stock
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[February 07, 2017]
By Taiga Uranaka
(Reuters) - Fujitsu Ltd's biggest shareholder is planning to sell about
$1 billion worth of the Japanese electronics conglomerate's stock, part
of a plan by the two firms to unwind their cross-shareholdings.
The sale comes at a time when Tokyo-listed firms are under pressure to
justify their holdings after Prime Minister Shinzo Abe's government
introduced a new corporate governance code in 2015.
While cross-shareholdings aimed at cementing business ties are common in
Japan, they are often criticized for making management less responsive
to individual and overseas shareholders.
Fujitsu's biggest shareholder, Fuji Electric Co, plans to unload about
8.2 percent of its stock, most of its holding. SMBC Nikko Securities has
been hired as an underwriter to sell the stock to overseas investors.
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A logo of Fujitsu
is pictured at CEATEC (Combined Exhibition of Advanced Technologies)
JAPAN 2016 at the Makuhari Messe in Chiba, Japan, October 3, 2016.
REUTERS/Toru Hanai/File Photo
of the share sale have not been decided but based on Fujitsu's Tuesday closing
price, the shares would be worth about 114 billion yen ($1 billion).
Fujitsu also said it plans to buy back up to 1.9 percent of its outstanding
shares for as much as 25 billion yen to alleviate the impact of such a large
stake sale on existing shareholders.
Fujitsu was originally created in 1935 as a telephone equipment subsidiary of
Fujitsu, also the biggest shareholder in its former parent with a 10 percent
stake, said it plans to sell its holding in Fuji Electric but the timing and
scale of the sale has yet to be determined.
(Reporting by Taiga Uranaka and Chris Gallagher; Editing by Edwina Gibbs)
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