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。

Transforming Teikoku


Transforming Teikoku

AVI have been shareholders in Teikoku since March 2018. Since then, we have engaged with the company on a range of issues, in particular, those relating to the Teikoku’s inefficient balance sheet. However, despite improving corporate governance across Japan and widespread acceptance that hoarding excess cash and maintaining “strategic securities” portfolios erodes corporate value, Teikoku has failed to make adequate improvements.

Teikoku’s Board, with the implicit support of Teikoku’s “group shareholders”, have created a value-destructive balance sheet in which 70% of total assets consist of cash and so-called “strategic securities”.  Hulic, a real estate business completely unrelated to Teikoku’s core business, alone accounts for over 30% of Teikoku’s total assets.

Over the past two years, other shareholders have submitted proposals targeting Teikoku’s inefficient balance sheet. Despite being in shareholders’ best interests, the proposals failed to receive sufficient support because Teikoku’s “Group Shareholders” blindly voted with management. It is time to hold “Group Shareholders” accountable for their voting. We call on Teikoku’s “Group Shareholders” to stop voting passively with management and vote in the interests of all shareholders and best governance practices.

AVI’s shareholder proposals for a ¥76/share dividend and 3% share buyback are intentionally modest. The proposals are meant to be a first step towards Teikoku’s balance sheet reform. If Teikoku’s “Group Shareholders” acknowledge the need to improve Teikoku’s balance sheet efficiency in the interests of all shareholders, AVI is confident that its proposals will receive majority support.

Joe Bauernfreund
29th January 2020

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.

Register your interest