By Makiko Yamazaki and Yuki Nitta
TOKYO (Reuters) -The board of Japan’s Shinsei Bank has decided to use a poison-pill defence against an unsolicited $1.1-billion bid from SBI Holdings, sources familiar with the matter said on Friday.
Tokyo-based Shinsei plans to issue stock warrants to existing shareholders which would dilute SBI’s stake, said the sources, who declined to be identified ahead of a Shinsei briefing later in the day.
Shinsei declined to comment.
The Nikkei business daily reported Shinsei will seek approval from shareholders for the defence at an extraordinary meeting in November. Shinsei will also ask SBI to extend its tender offer period, which is currently scheduled to end on Oct. 25, the newspaper said.
SBI, which owns Japan’s largest online brokerage, operates an online bank and has stakes in regional banks, said last week it plans to lift its stake in Shinsei to as much as 48% from 20%. It is offering 2,000 yen per share, a 39% premium to Shinsei’s share price before the announcement.
The hefty premium may make it tough for Shinsei to win over the required majority support from shareholders.
Much may turn on how the Japanese government, which owns 22% of Shinsei, will vote. Shinsei still owes the government 350 billion yen ($3.2 billion) after receiving public funds during Japan’s banking crisis two decades ago.
Shinsei is also talking to other potential suitors, but it has been hard to find one willing to top 2,000 yen per share, the sources said.
($1 = 109.8200 yen)
(Reporting by Makiko Yamazaki; Editing by Himani Sarkar and Edwina Gibbs)
