Fuji Soft has opted to continue its support for KKR’s tender offer despite a superior bid from Bain Capital. The decision follows a board meeting in which shareholders were urged to accept KKR’s proposal ahead of a Monday deadline. Concerns exist regarding Bain’s capacity to acquire the company privately, stemming from the complexities of shareholder consensus.
Fuji Soft has decided to support KKR’s tender offer for its shares, despite receiving a higher bid from Bain Capital, which has the backing of the company’s founder. In a board meeting held on October 18, Fuji Soft expressed its recommendation for shareholders to accept KKR’s initial offer before the deadline on Monday. Bain’s recent proposal stands at ¥9,450 ($63) per share, surpassing KKR’s offer of ¥8,800 per share. Bain has indicated it intends to initiate its tender offer in late October, pending Fuji Soft’s endorsement. The company has pledged to assess Bain’s offer and disseminate its perspectives at the commencement of the bid. A spokesperson for KKR conveyed satisfaction regarding Fuji Soft’s ongoing endorsement of their tender offer, expressing appreciation for their recommendation. The founder of Fuji Soft, Hiroshi Nozawa, has publicly supported Bain’s proposition, noting its alignment with the company’s strategic direction. He further expressed hope that KKR would consider submitting its shares if acquired from principal shareholders, who have already committed to selling their stakes. Fuji Soft’s special committee has raised concerns about Bain’s ability to privately acquire the firm and emphasized potential challenges in securing agreement amongst major shareholders during the tender process. KKR’s acquisition strategy involves two phases, having accelerated its tender offer’s initiation to September 5, following Bain’s preliminary interest. The trend of increased mergers and acquisitions in Japan is driven by a weakened yen and the regulatory emphasis on shareholder value. Despite the higher valuation from Bain, Fuji Soft indicated that KKR’s offer represented a more assured transaction. As a provider of software solutions for prominent financial institutions, Fuji Soft is under scrutiny from major shareholders advocating for privatization.
The backdrop of this situation involves two prominent private equity firms vying for control of Fuji Soft, a Japanese software provider with extensive ties to major financial institutions. The context of increased merger and acquisition activity in Japan is significant due to a declining yen, which enhances the attractiveness of overseas investments. Fuji Soft’s decision-making process reflects an assessment of the reliability and certainty of the offers received.
In conclusion, Fuji Soft has reaffirmed its commitment to KKR’s tender offer, prioritizing reliability over a higher valuation proposed by Bain Capital. The firm is navigating complex shareholder dynamics, with its previous agreements emphasizing a stronger feasibility associated with KKR’s offer. This strategic choice highlights the nuances involved in high-stakes financial decisions amidst a competitive acquisition landscape.
Original Source: www.japantimes.co.jp
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