| TOKYO, March 10
TOKYO, March 10 Cerberus Capital Management LP
will announce plans as early as Monday to raise its stake in
Seibu Holdings Inc and install new directors to tighten its grip
over the Japanese railway and property group, finance industry
sources briefed on the plan said.
The U.S. investment fund led a bailout of Seibu in 2005 and
is its biggest shareholder. But Cerberus has been at odds with
Seibu management, including Seibu President Takashi Goto, over
the terms of a multi-billion dollar stock market listing
originally planned for 2012.
Cerberus also wants to take a different strategy from
Seibu's management to maximize its return on investment, the
The proposals could set the stage for a public battle
between Cerberus and the management of Seibu, which was delisted
from the Tokyo Stock Exchange in 2004 after it was found to have
falsified shareholder records.
Cerberus's plan involves a public tender to nudge its stake
in Seibu to just above one-third from the current 32.4 percent,
a level that would allow it to veto major board decisions, the
The U.S. fund's plans to raise its stake and propose new
board members were first reported by Japanese media last week.
In a statement on Saturday, Cerberus said it was planning to
make an announcement this week but did not elaborate.
A spokesman for Seibu declined to comment.
Cerberus will propose three new directors including Hirofumi
Gomi, former commissioner of Japan's financial regulator, the
sources said. In addition to Gomi, Cerberus is planning to
propose Masaharu Ikuta, former president of Japan Post, and
Aozora Bank Ltd Director Yuji Shirakawa join the Seibu
management team, the sources said.
Cerberus has also started sounding out Mizuho Corporate Bank
and other leading shareholders about selling their shares,
according to the sources, who spoke on condition of anonymity
because the fund's proposals have yet to be announced.