Sumitomo Mitsui Financial Group Inc. announced Friday it had given up its controversial attempt to merge with UFJ Holdings Inc., giving in to rival Mitsubishi Tokyo Financial Group Inc.
The withdrawal of the nation’s third-ranked banking group put a lid on the first-ever hostile takeover bid in Japan’s financial industry.
In a statement released Friday, SMFG said it decided to withdraw the bid because recent stock prices and views from investors suggested the market generally supports the MTFG-UFJ merger.
SMFG also said its merger offer no longer benefited its shareholders and those at UFJ, given the advancement of merger preparations by MTFG and UFJ.
MTFG and UFJ announced last week their merger ratio will be 0.62 MTFG share to one UFJ share, which analysts consider to be fairly attractive to UFJ shareholders.
SMFG had offered UFJ a 1-to-1 merger ratio.
SMFG began its merger attempt in August, soon after MTFG and UFJ signed a basic accord to merge this October.
The new Mitsubishi UFJ Financial Group will become the world’s largest banking group by assets.
SMFG said earlier this month it will begin merger talks with Daiwa Securities Group in the near future. The two groups have agreed to merge their venture capital units Oct. 1.
UFJ ATMs disabled
UFJ Bank said Friday its automated teller machines and part of its system at branches in the Tokyo, Osaka and Nagoya areas were offline in the morning for a short period.
The bank said users were unable to withdraw or transfer money at ATMs and on other systems from around 8:55 a.m. until 10:30 a.m.
The system problem was caused by large-lot deposits to bank accounts, the bank said. Many companies pay wages into employees’ accounts on the 25th of the month.
UFJ Bank, which has about 6,200 ATMs nationwide, said it plans to investigate the system breakdown.
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