The Tokyo High Court heard arguments Friday from Livedoor Co. and Nippon Broadcasting System Inc. over the appropriateness of a district court order barring the radio firm from issuing stock warrants to Fuji Television Network Inc., sources said.

The high court will probably hand down a ruling shortly because NBS has said it would issue the subscription warrants Thursday if a court overturns the injunction that was issued March 11 and then upheld Wednesday by the Tokyo District Court.

A subscription warrant refers to a right to buy new shares at a prescribed price, usually over a certain period. In the case of the NBS warrants, they could be converted into new shares from March 25.

On Feb. 23, Nippon Broadcasting said it would sell Fuji TV the right to buy up to 42.7 million new shares, a move that would dilute Livedoor’s stake to some 17 percent and strip it of a chance to reshuffle the radio firm’s management in Livedoor’s favor.

But on March 11, the district court issued the injunction on grounds that such warrants were designed to preserve control of a management friendly to Fuji TV, thus making the issuance a “grossly unfair” plan to fend off Livedoor’s takeover bid.

On Wednesday, the district court upheld the injunction and NBS immediately appealed to the high court.

Fuji affiliates weigh in

The Fuji Network System on Friday threw its support behind Fuji Television Network Inc. in its battle with Livedoor Co. for control of Nippon Broadcasting System Inc.

The 27 local affiliate stations said in a resolution adopted the same day that if NBS is forcibly brought under Livedoor’s control, it would result in “extremely serious” problems.

Internet service provider Livedoor and Fuji TV have been battling for control of the radio broadcaster since early February.

According to Livedoor sources, purchases made earlier this week gave the fast-growing Internet firm a stake topping 50 percent in NBS in terms of voting rights.

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