Third-party panel to evaluate stock-buy plan
Internet shopping mall Rakuten has no plans to acquire a majority share in TBS, it said in a questionnaire submitted to the Japanese broadcaster.In replying to 70 questions asked by TBS, Rakuten said it wants to promote content online and otherwise maximize synergies between the two companies’ core businesses — broadcasting and Web-based marketing. Rakuten also assured its putative partner that it will “not engage in abusive purchases (of TBS shares) and will increase its holdings in accordance with procedures laid down by TBS.” TBS did not release the full text of Rakuten’s replies, since they contain confidential corporate information. In March, Rakuten signaled its intention of increasing its TBS stake from 19% to 20%, a move that would allow the Internet powerhouse to include the broadcaster in its consolidated account, while increasing its influence over TBS’s corporate governance. TBS has indicated that if Rakuten one-sidedly takes such a step, the web will unleash a poison-pill defense of issuing equity warrants, while enlisting the support of the stable shareholders who hold nearly 60% of TBS stock. On April 27, a third-party panel convened to evaluate Rakuten’s stock-buy plan. If the panel decides that Rakuten’s bid to boost its stake in TBS to 20% and over is “abusive,” it will give the web the greenlight to active poison-pill measures. Also, TBS sent a questionnaire to Rakuten asking its potential partner to clarify its intentions. While the panel deliberates, Rakuten has promised to refrain from TBS stock purchases. If the panel rules against Rakuten, however, Rakuten is likely to go to the courts while continuing its attempts to lobby TBS shareholders for support. The bad blood between the two companies can be traced back to Rakuten’s massive buy of TBS shares in October 2005, which the broadcaster regarded as a hostile takeover bid — and resisted fiercely. Ever since, Rakuten has been pushing for partnership talks, while TBS has demanded that Rakuten first unload its TBS shares before such talks begin.