UPDATE 4-Mitsui Fudosan to pay $1.2 bln to acquire Tokyo Dome amid activist pressure

* Mitsui Fudosan pays 1,300 yen per share in Tokyo Dome

* Tokyo Dome will be delisted from Tokyo Stock Exchange

* Oasis Management has called for Tokyo Dome to remove board members (Adds official announcement)

TOKYO, Nov 27 (Reuters) – Japanese property developer Mitsui Fudosan Co said on Friday it would pay 120.5 billion yen ($1.16 billion) to acquire ballpark operator Tokyo Dome Corp which has been under fire by a foreign activist.

Mitsui Fudosan, part of the Mitsui group of companies, aims to acquire all shares of Tokyo Dome through a tender offer (TOB), it said in a statement, adding Tokyo Dome will be delisted from the Tokyo Stock Exchange.

The bid comes as Tokyo Dome became a target for corporate activism, with Hong Kong-based fund Oasis Management, its top shareholder, calling for the removal of board members and changes to the company’s operations.

“We came to a conclusion that it’s best to partner with Tokyo Dome as we have sought urban development based on sports and entertainment,” Mitsui Fudosan said. Tokyo Dome said in a separate statement it has agreed with the bid.

But Tokyo Dome’s operations which include a ballpark, theme park and hotel business has been hit by the COVID-19 pandemic, and it reported a 9.8 billion yen net loss in the six months through July.

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Mitsui Fudosan will pay 1,300 yen per Tokyo Dome share in the TOB, according to the statement. The price amounted to a premium of 44.9% to Thursday’s closing price.

Mitsui Fudosan also said it would sell 20% of the shares to Yomiuri Shimbun, the owner of the Tokyo Giants baseball team, after the deal completes to boost competitiveness in an expected synergy.

The bid could be an example of Japan Inc closing ranks to protect one of its own from an activist, an expert said, as activist investors have demanded more change at Japanese companies.

“Tokyo Dome must have thought Mitsui Fudosan is a better partner while it was under fire by a foreign activist, as Mitsui is a famous Japanese group and is unlikely to hit hard on the company,” said Ichiro Kurihara, a director of Tachibana Securities.

Oasis Management has called for a special shareholders’ meeting to remove three board members, including President Tsutomu Nagaoka.

The fund has argued that Tokyo Dome was not making the best use of the prime location of its stadium, as well as the hotel and theme park in the complex. The company is due to hold an extraordinary shareholder meeting on Dec. 17.

Tokyo Dome management is now expected to stay in place after the deal for at least a year, a person familiar with the matter said.

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Oasis has not responded to a comment request by Reuters after the companies’ announcement came out.

Mitsui Fudosan’s shares closed up 1.9% on Friday, while Tokyo Dome shares were up 16.7% at the day’s upper price limit.

$1 = 104.0100 yen Reporting by Chang-Ran Kim and Takashi Umekawa; editing by Jane Wardell, Richard Pullin and Ana Nicolaci da Costa


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