U.S. Investment fund Steel Partners Japan Strategic Fund (Offshore) L.P. said it launched a public tender offer Friday for all the outstanding shares of Myojo Foods Co.
Steel Partners Japan is already Myojo's top shareholder, with a stake of some 23.1 percent. It said it is only after investment gains but aims to hold the shares over the long term in the belief that their price has been undervalued in light of the food-maker's strong business performance.
It said it highly regards the business skills of Myojo's management team and wants it to stay on.
Myojo Foods officials, on the other hand, said the company is considering how to respond to Steel Partners' move. It is expected to decide whether to accept the tender offer next week.
Steel Partners' takeover attempt could turn hostile, market observers said.
The tender offer by the fund is due to continue until Nov. 27, offering 700 yen per share against the stock's closing price Thursday of 609 yen. If the fund manages to purchase all of the remaining Myojo shares, the purchase would cost an estimated 23 billion yen.
Myojo Foods is listed on the second section of the Tokyo Stock Exchange and has a popular line of instant noodle brands. A large block of its shares was once owned by the fund led by financier Yoshiaki Murakami, who has been indicted for insider trading.
In December 2003, Steel Partners Japan announced hostile takeover bids for Yushiro Chemical Industry Co. and textile dyer Sotoh Co. Though the attempts failed, the fund extracted sharp dividend hikes from the two companies.