The founding family of Japanese oil company Idemitsu Kosan has signaled it will drop its opposition to long-stalled plans for a merger with rival Showa Shell Sekiyu, clearing the way for the two to combine next spring.
The family, which holds 28% of Idemitsu’s shares, laid out conditions for its support in behind-the-scenes talks with management. Its demands included a pledge to uphold the principles espoused by founder Sazo Idemitsu, along with two board seats reserved for family members at the merged company. Idemitsu agreed to bring on the eldest son of Chairman Emeritus Shosuke Idemitsu as a director.
The boards of Idemitsu and Showa Shell are to meet on mid-July to make a final decision on the merger. The transaction would then be put to shareholders for approval at extraordinary meetings within the year. The companies have been taking steps toward integrating even with the merger on hold.
The two companies plan to combine through a stock swap. The merged entity will maintain leaders from both companies in key roles, including Chairman Takashi Tsukioka and CEO Shunichi Kito from Idemitsu and President and CEO Tsuyoshi Kameoka from Showa Shell.
Full Content: Asian Review
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