Firm Fears ‘Thugs’ May Greet Pickens at Japan Meeting
Officials of Koito Manufacturing Co. are bracing for a rambunctious general shareholder meeting today, anticipating that a cast of thugs will be on the scene to cause trouble and discredit management when American corporate raider T. Boone Pickens Jr. takes the floor.
Takao Matsuura, Koito’s president, told foreign journalists Wednesday night that he was “very concerned” about the possibility of a disturbance at the meeting caused by sokaiya , underworld gadflies whose specialty is disrupting, or controlling, shareholder meetings in an extortion racket unique to Japan.
Matsuura, whose face is gaunt, displayed a photograph of himself in a company brochure and said he had lost 8.8 pounds “because of the Pickens shock.”
Pickens rankled the Koito board and sent nervous ripples throughout corporate Japan when he declared in April that he had become Koito’s largest shareholder after acquiring a 20.2% stake in the automotive parts maker, which is closely affiliated with Toyota Motor Corp.
The flamboyant Texan demanded three seats on the Koito board and a voice in running the company, portraying his acquisition as a long-term, stable investment. Koito rejected the demands, contending that Pickens’ aim was either a hostile takeover bid or “greenmail.”
Now, Pickens is in Japan again to promote his brand of shareholder democracy, bucking a system that gives managers unchallenged power and locks up most outstanding stock in the hands of friendly business allies.
At the annual shareholder meeting scheduled for today, he is expected to hold Koito management to task for skimping on dividend payments and shaving profits too thin in contracts with Toyota, which has 45% of Koito’s business and owns 19% of the company--the largest stake until Pickens came along.
He also might remark on the closed nature of Japan’s business world and financial markets, a politically charged theme he has taken up extensively in the United States recently while hinting that he may run for governor of Texas.
“If the United States and Japan are going to improve their trade situation, and if Japan is going to compete in the global marketplace, Japanese corporations have to change,” Pickens said at a news conference in Washington on Monday. “They can’t stay locked up. We are demanding it, and more and more Japanese investors are demanding it.”
But the sokaiya could make it somewhat difficult for Pickens to articulate that demand in what promises to be a highly publicized forum today.
Koito officials have learned through the trust bank that handles the company’s share registration that there were 10 sokaiya and five members of an ultra-rightist organization listed as investors as of March 31, the end of the latest fiscal year. Anyone owning stock has the right to attend the shareholder’s meeting.
Although both groups are reputed to be linked to a major yakuza , or organized crime family, it is widely speculated that one group would heckle management while the other would harass Pickens.
Denies Any Deal
Ordinarily, sokaiya are employed by management to quell dissent and ensure that meetings run smoothly and end quickly. But they also heckle and filibuster when payoffs are not made, which has become more common in recent years as Japanese police have begun enforcing a law that prohibits companies from giving money to sokaiya .
Tamotsu Aoyama, general manager of Koito’s corporate administration and finance division, said emphatically Wednesday that the company had no contacts with sokaiya and had never had relationships with them in the past.
Who, then, would they be working for?
Koito is not accusing Pickens of conspiring with the squeeze artists.
“The company has no reason to believe that Mr. Pickens has any connection with any sokaiya group,” said a source close to management, who spoke on the condition of anonymity.
But the source suggested that the sokaiya were brought into the picture by Kitaro Watanabe, the auto dealer, real estate speculator and occasional greenmailer who sold the block of Koito shares to Pickens’ Boone & Co.
“We think there’s a lot going on here that Mr. Pickens doesn’t understand,” the source said.
Koito, meanwhile, has shored up its defense team, hiring Nomura Wasserstein Perella & Co., a Japanese joint venture of Normura Securities and Wasserstein, Perella & Co. of New York. Wasserstein is a U.S. investment firm headed by merger and acquisition specialists who have successfully fended off Pickens in some of his takeover attempts. Koito also has retained the New York public relations firm of Kekst & Co., a veteran of many U.S. corporate battles.
