Market confidence in Internet company Livedoor Co. appeared to ebb Tuesday as its share price temporarily dropped to a record low of 292 yen on the Tokyo Stock Exchange.
Livedoor shares ended the day at 293 yen.
It was the third day in a row Livedoor’s share price has fallen, and its first close below 300 yen since it was listed in April 2000.
Observers said market players are growing wary of Livedoor’s prospects because of the lack of visible progress in its effort to forge an amicable alliance with Fuji Television Network Inc.
The company has also incurred about 10 billion yen in latent losses from a drop in the price of Nippon Broadcasting System Inc., for which Livedoor holds a majority stake, market players said.
Both Fuji TV and NBS are members of the Fujisankei media conglomerate. Livedoor acquired the radio broadcaster last month in a hostile takeover that was contested by Fuji TV, whose largest shareholder was the smaller NBS.
In addition, Lehman Brothers Inc. has been converting its holdings of convertible bonds issued by Livedoor into stock, leading to a deterioration in the supply-demand balance of the issue.
Livedoor President Takafumi Horie returned from an overseas business trip Tuesday and told reporters at Narita International Airport that he could not comment on his company’s share price.
Horie, however, emphasized that his business was fine and that there were no plans to revise its earnings forecasts.
“Is there some factor that says a business becomes unstable when negotiations are stalled?” he asked in response to suggestions that his company’s relations with Fuji TV were the reason for the declining stock price. “There’s no problem whatsoever.”
A falling share price is worrying for Livedoor because it can lead to a decline in market value, pundits say.
On Feb. 8, when Livedoor’s shares were at their highest this year, its market value stood at around 320 billion yen. In just two months’ time, however, it has dropped to less than 190 billion yen.
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