Teikoku Sen-i (Teikoku)

Transforming Teikoku

Presentation    Shareholder Proposal

LONDON–Asset Value Investors (“AVI”) announces that its dividend proposal received a record level of votes at the Annual General Meeting of Teikoku Sen-i (“Teikoku Sen-i” or the “Company”) (TSE: 3302) on 27th March 2020.

AVI’s proposal for a ¥76 per share dividend received 24.7% approval, topping the level of support for dividend proposals submitted by shareholders in previous years.

AVI’s proposal for a ¥2 billion share buyback received good support with a 22.0% approval.

AVI CEO Joe Bauernfreund commented, “Considering that “Group Shareholders” own a significant portion of the company the level of support for our proposals is encouraging.”

“General shareholders like ourselves who hold their shares as an investment, and not as a token of separate business relationships, are sending Teikoku Sen-i management and affiliated group shareholders the message that a balance sheet bloated with investment securities and other financial assets must be reformed.”

“There is no way to justify a balance sheet in which 64% of total assets consist of cash and investment securities, including a “strategic holding” in an unrelated real estate company Hulic accounting for 32% of total assets”.

“We remain hopeful that the Company’s affiliated group shareholders will encourage management to rationalise Teikoku Sen-i’s value-destructive capital structure.”

The Company’s proposal to renew its shareholder rights plan (“poison pill”) was opposed by 21.9% of shareholders, reflecting the view of Institutional Shareholder Services (“ISS”) and general shareholders that the effect of the plan is to entrench incumbent management.

Reflecting the recommendation of proxy advisory firm ISS that President Tsuyoshi Shiraiwa be held responsible for the Company’s questionable capital management, shareholder disapproval for his re-election was higher than in the preceding year.

AVI looks forward to continuing its dialogue with the Company as long-term shareholders.

About AVI

Founded in London in
1985, AVI has a long history of investing in Japan. Over the past few years we
have observed the heightening interest in Japan driven by corporate governance
reforms. What we have seen convinces us that profound change is underway, and we
launched a dedicated fund, AVI Japan Opportunities Trust (‘AJOT’), to target
the plentiful opportunities the reforms will bring. Across AJOT and AVI Global
Opportunities Trust (‘AGT’), AVI has ¥55bn invested in Japan.

We always take a
long-term view with our investments, seeking high-quality companies that the
market misunderstands and undervalues. We work with company management and
boards to improve long-term corporate value.

Also available in: 日本語 (Japanese)

AVI Japan Opportunity Trust

Key facts

  • Total assets:
    164.8 million*
  • Launch date:
    23 October 2018
  • Return since launch:
  • Ongoing Charges:

* As at 31 January 2023
** Source: Morningstar, performance period 23 October 2018 to 31 January 2023, NAV TR net of fees, GBP
*** As at 30 September 2020, includes: management fee 1.0%, marketing and administration costs.

AVI Japan Opportunity Trust p.l.c is referred to as ‘AJOT’ throughout the website. AJOT’s investment managers, Asset Value Investors are referred to as ‘AVI’

AJOT currently conducts its affairs so that its shares can be recommended by Independent Financial Advisers (“IFAs”) in the UK to ordinary retail investors in accordance with the Financial Conduct Authority (“FCA”) rules in relation to non-mainstream investment products and intends to continue to do so. The shares are excluded from the FCA’s restrictions which apply to non-mainstream investment products because they are shares in an authorised investment trust. © AVI Japan Opportunity Trust plc. 2018 Registered in England No: 11487703. An investment company under Section 833 of the Companies Act 2006. Registered Office: 6th Floor, 65 Gresham Street, London EC2V 7NQ. Managed by Asset Value Investors Ltd. which is authorised and regulated by the Financial Conduct Authority. Past performance should not be seen as an indication of future performance. The price of investments and the income may fall as well as rise and investors may not get back the full amount invested. AJOT may use gearing techniques (leverage) which will exaggerate market movements both down and up which could mean sudden and large falls in market value. Please refer to the Key Features Document for further details of the risks affecting your investment. Performance figures are cumulative and based on Price total return and do not include Plan charges. For more information, please call 03458 500181. Tax treatment depends on the individual circumstances and may be subject to change in the future. Asset Value Investors Ltd do not offer Innovative Finance ISAs.

Legal disclaimer

This website, and the information contained herein, (collectively referred to as “the Website”) is being provided for the shareholders of Teikoku Sen-i Co., Ltd. (“Teikoku”) for information purposes only.  Asset Value Investors Limited (“AVI”) is the investment manager of two of the shareholders of Teikoku, namely AVI Global Opportunities Trust (“AGT”) and AVI Japan Opportunities Trust (“AJOT”).

AVI is authorised and regulated by the UK Financial Conduct Authority (“FCA”) and is also registered as an Investment Advisor with the United States Securities and Exchange Commission (the “SEC”) under the United States Investment Advisors Act of 1940.

The Website is directed only at Professional Clients or Eligible Counterparties as defined by the UK FCA.

AVI sent written proposals addressed to Teikoku (the “Proposals”) through which AVI seeks to ask shareholders to vote on an increased dividend and the introduction of a buyback programme.  The Proposals are accessible through the Website.  AVI created the Website to help enable visitors to reach their own conclusion regarding whether or not to support the Proposals.

The Website was created solely for the purpose mentioned above and is provided for information purposes only.  AVI is by no means soliciting or requesting other shareholders of Teikoku to jointly exercise their shareholders’ rights with AVI (including, but not limited to, voting rights).

AVI declares that it does not intend to be treated or deemed a “joint holder” (kyo-do hoyu-sha) with other Teikoku shareholders under the Japanese Financial Instruments and Exchange Act by virtue of disseminating information through the Website or engaging in dialogue with other Teikoku shareholders in or through this Website.

The Website exclusively represents the opinions, interpretations and estimates of AVI in relation to Teikoku’s business and governance structure.  AVI is expressing such opinions, interpretations and estimates solely in its capacity as an investment manager of AGT and AJOT.

The information contained herein is derived from proprietary and non-proprietary sources deemed by AVI to be reliable.  While AVI believes that reasonable efforts have been made to ensure the accuracy of the information contained in the Website, AVI makes no representation or warranty, expressed or implied, as to the accuracy, completeness or reliability of such information.








本ウェブサイトは、帝繊の事業およびガバナンス体制に関するAVIの見解、解釈 、評価を掲載したものであり、AVIはあくまでAGTおよびAJOTの資産運用管理者の立場からこれらの見解、解釈 、評価を述べております。

本ウェブサイトに掲載される情報は、AVIが信頼できると判断した専有又は非専有の情報源から得たものです。AVIは本ウェブサイトに掲載する情報の正確性を確保するために合理的な注意を払っておりますが、その正確性、完全性および 信頼性について明示・黙示にかかわらず一切の表明・保証をするものではありません。

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