Japan weighs expanding tender offer rules as unsolicited takeovers rise
TOKYO : Japan's financial regulator is considering expanding the range of transactions for which a tender offer is required, in what would be the first revision of the country's takeover rules in 17 years, amid a wave of unsolicited takeovers.
The Financial Services Agency (FSA) on Thursday asked an expert panel to review takeover regulations, following a sharp rise in unrestricted stake-building on the market which has led to unsolicited takeovers.
Currently, an acquirer is required to make a tender offer if it wants to buy more than a third of a company's shares off market.
However the rules do not apply to stake-building on the market, which experts say is a loophole that allows an effective takeover without other shareholders having a say on the acquisition.
The issue gained attention when Tokyo-listed Asia Development Capital (ADC) built up most of its 40 per cent stake in printing press manufacturer Tokyo Kikai Seisakusho Ltd on market in a matter of weeks, enough to give it veto rights over important board decisions.
