Kadoya Sesame Mills has a binding rival proposal on the table that beats ITG-G Holdings' ¥2,514-a-share tender offer at every price point, though the highest figure is not available to every shareholder. The company's amended opinion report says it received the proposal from "Company C", which it does not name, on October 27. Earlier Tokyo Brief coverage
Four prices, one condition
Company C's tender price depends on which large holders sign agreements not to tender and to sell to Kadoya through a share buyback instead.
| Structure | Tender price per share |
|---|---|
| Non-tender and buyback deals with Mitsubishi, Mitsui and two founding-family shareholders | ¥3,000 |
| Deals with the two corporate shareholders (Mitsubishi and Mitsui) only | ¥2,907 |
| Deals with Mitsubishi and two founding-family shareholders | ¥2,872 |
| Tender offer only, no buyback (not the expected structure) | ¥2,654 |
Company C has signed none of these agreements. It says it is in talks with Mitsubishi Corporation, including contract markups, and in repeated discussions with Mitsui & Co. It intends to launch in mid-November, subject to conditions that include obtaining Kadoya's endorsement of its offer and keeping it in place. Funding would come from fund equity and bank loans, with commitment letters from two banks and the funds attached.
The clock on ITG-G
Kadoya judged Company C's proposal a qualified competing proposal under its agreement with ITG-G and asked ITG-G on October 28 to discuss a higher price. If ITG-G does not re-propose a price at or above Company C's by October 29, or by November 9 if it extends its offer period, Kadoya may withdraw or change its board endorsement and terminate the agreement.
ITG-G extended its offer on October 29 from October 30 to November 13, 39 business days in all, and moved the start of settlement from November 9 to November 20. As of October 29, Kadoya's special committee advice and its board's recommendation that shareholders tender into ITG-G's offer were unchanged.