Four asset managers who own stakes in Japanese cableco Jupiter Telecommunications have said the tender offer price for their remaining shares in the company is too low.
Japanese telco KDDI and trading house Sumitomo, which currently hold 30.71% and…
Four asset managers who own stakes in Japanese cableco Jupiter Telecommunications have said the tender offer price for their remaining shares in the company is too low.
Japanese telco KDDI and trading house Sumitomo, which currently hold 30.71% and 39.98% stakes in Jupiter respectively, are seeking to buy all remaining shares in the company.
The initial offer price was Y110,000 (US$1,194) per share but this was raised to Y123,000 (US$1,335) per share at the end of last month.
The four asset managers – Beach Point Capital Management, Neuberger Berman, Owl Creek Asset Management and P. Schoenfeld Asset Management – own around 5.5% of the shares in Jupiter. They have written a joint letter to the board of directors expressing their disappointment in the revised offer.
In a copy of the letter seen by TelecomFinance, the asset managers called the offer “grossly inadequate”, saying that the Y139,500 (US$1,493) per share price that Sumitomo and KDDI paid in 2010 to increase their ownership to their current level should be considered “merely the starting point” for any valuations.
The letter went on to say that Jupiter’s financial results had improved since 2010, and suggested a minimum value per share of Y160,700 (US$1720) based on EBITDA for 2012.
Another argument put forward in the letter was that Japan’s Topix stock exchange has increased by 30% since the tender offer was first announced, and the current offer price does not reflect this market increase.
Law firms Nijubashi Partners and O’Melveny and Myers are acting on behalf of the asset managers.
