Another Blow to 'The Family'

Seibu Railways today announced its reorganization under a new holding company to be formed in March. Yesterday, it rejected a rival takeover bid launched by two brothers of the disgraced founding-family scion Yoshiaki Tsutsumi. As expected, the current management picked Cerberus and Nikko Principal Investments (see my previous post) to be the biggest shareholders in the new entity, Seibu Holdings.
Yuji and Seiji Tsutsumi had countered that the Cerberus-led deal would have valued each Seibu share at about Y700 yen per share, while they would be offering 1,150 to 1,300 yen. The cost for 100 percent ownership under those terms would have been 500 billion yen to 560 billion yen (FT). They were joined at the last minute by deep-pocketed Starwood Capital, joining Goldman Sachs and Morgan Stanley (who had been beaten by Cerberus) in clamoring for a piece of the action. Starwood, no doubt with its eye on Seibu’s Prince Hotel portfolio, offered the Tsutsumi brothers funding of up to 5 billion dollars, or about 580 billion yen, enough to fund the entire acquisition, according to the Nikkei. In spite of the higher price, Seibu shrugged off the offer and pressed on with Cerberus/Nikko.
The Tsutsumi brothers will press on with lawsuits to claim ownership and block the formation of Seibu Holdings.

Link - Nikkei/Dow Jones : Seibu Goes with Cerberus, Nikko; Nixes Tsutsumis' Bid

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