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Shinsei Bank plans poison-pill defence against SBI’s $1.1 billion bid -sources By Reuters


By Makiko Yamazaki and Yuki Nitta

TOKYO (Reuters) -The board of Japan’s Shinsei Bank has decided to use a poison-pill defence against an unsolicited $1.1-billion bid from SBI Holdings, sources familiar with the matter said on Friday.

According to sources close to the matter, Shinsei, a Tokyo-based bank, plans to issue stock warrants for existing shareholders, which will dilute SBI’s stake.

Shinsei did not respond to requests for comment.

The business daily reported Shinsei will seek approval from shareholders for the defence at an extraordinary meeting in November. Shinsei also plans to ask SBI for a prolongation of its tender offer period. Its current expiry date is Oct. 25.

SBI is Japan’s biggest online brokerage. It also operates an online banking service and holds stakes in several regional banks. Last week, Shinsei announced that it will increase its stake in Shinsei from 20% to 48%. The share price is 2,000 yen, which represents a 39% premium over Shinsei before this announcement.

Shinsei may struggle to get the majority shareholder support due to this large premium.

It will be important to see how Shinsei’s Japanese government (which owns 22%), votes. Shinsei still owes Japan 350 billion yen ($3.2 million) for receiving public funds in the wake of Japan’s bank crisis.

Shinsei also talks to potential suitors. However, it is difficult to find someone willing to offer a share price of more than 2000 yen, sources claimed.

($1 = 109.8200 yen)

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