(Reuters) – Activist investor Oasis Management on Monday urged shareholders of Hokuetsu Corp to vote against the re-election of CEO Sekio Kishimoto after Japan’s No.5 paper maker refused a call to sell its stake in a larger rival.
Hong Kong-based Oasis, Hokuetsu’s biggest shareholder with a more than 18% stake, said in a statement that the departure of Kishimoto, also president of the company, would enhance Hokuetsu’s corporate value over the long term.
Oasis has been pushing Hokuetsu to divest its 24.6% stake in No.4 paper maker Daio Paper Corp, citing “the lack of synergies achieved which might have justified the risks involved in holding such a single large investment”.
Hokuetsu became the top shareholder in Daio in 2012 when it acquired a large stake from Daio’s founding family.
A Hokuetsu spokesperson said no comment was immediately available as the company was checking the content of Oasis’ statement.
Shares of Hokuetsu traded flat early on Monday. The company will hold an annual shareholders meeting on June 29.
Oasis scored a major success at elevator maker Fujitec Co Ltd earlier this year when three outside directors were replaced with four new ones nominated by the fund.
(This story has been corrected to rectify the president & CEO’s name to Sekio Kishimoto, not Seiko Kishimoto, in paragraph 1)
(Reporting by Urvi Dugar in Bengaluru and Makiko Yamazaki in Tokyo; Editing by Christopher Cushing and Himani Sarkar)