TOKYO Aug 14 Japanese refiner TonenGeneral Sekiyu KK, in which U.S. oil major Exxon Mobil has a stake, has dropped plans to sell into the market stock held by its 99-percent-owned unit in a bid to raise funds, its president said on Tuesday.
The unlisted subsidiary holds 200 million shares in its parent TonenGeneral, Japan's second-biggest refiner, and TonenGeneral had said in January selling up to 50 percent of the holdings was among the options it was considering.
But that was no longer an option, TonenGeneral President Jun Mutoh said on Tuesday, adding that the company felt that planning a stock offering would not improve shareholder value.
"We want to use those shares to attain our business objective or business strategy," he told reporters at the release of second-quarter earnings. "We are not considering using them for public stock offering to raise funds."
Options for using those shares include pursuing new growth opportunities or strategic partnerships to improve corporate value, he added.
The stock holding is a result of the company's move this year to buy back a $4 billion controlling stake from Exxon, at a time when domestic oil demand is shrinking and Japanese refinery products are unable to compete with rivals located closer to developing economies.
Exxon Mobil's stake in TonenGeneral fell to 22 percent from 50 percent on June 1 after the transaction.