July 16, 2020 / 11:52 PM / 25 days ago

Japan's Ootoya says to formally oppose takeover bid by Colowide

TOKYO, July 17 (Reuters) - Japanese restaurant chain Ootoya Holdings said it would oppose a tender offer by its top shareholder, Colowide Co, turning the bid into the country's latest hostile deal.

In an emailed statement, Ootoya said it would announce later on Friday that a group of employees are against the takeover, followed by a formal decision on Monday by the board of directors to oppose the bid.

Colowide had said last week it would launch the bid to boost its stake to 51.32% from 19.16% as it seeks to expand through acquisitions. Japanese companies are increasingly seeking more control of affiliates to streamline operations.

Ootoya immediately criticised the offer, saying it came as a surprise given that Colowide knew the majority of shareholders opposed such a move. The bid also followed Colowide's failed attempt to install candidates to Ootoya's board - a proposal rejected at the annual shareholders' meeting last month.

Colowide, which runs a variety of restaurants from izakayas to sushi chains, has offered 3,081 yen a share. Ootoya shares closed at 2,860 yen on Thursday. (Reporting by Junko Fujita Editing by Chang-Ran Kim)

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