A report in The Wall Street Journal says Hoya Corporation has finally succeeded in its bid to acquire fellow Japanese optical devices and camera manufacturer, Pentax Corporation.

 

August 8, 2007: A report in The Wall Street Journal says Hoya Corporation has finally succeeded in its bid to acquire fellow Japanese optical devices and camera manufacturer, Pentax Corporation.
Results of a tender offer to shareholders, which closed yesterday, showed 122.7 million Pentax shares had been put up for sale. Hoya, which was aiming to buy at least a 50% stake in Pentax, is said to be purchasing all of the shares offered for 94.48 billion Yen, bringing its stake in Pentax to 90.58% in terms of voting rights. The company will pay 770 Yen for each Pentax share and aims to purchase the remaining Pentax shares, turning Pentax into a wholly-owned subsidiary.
The latest developments bring to an end the long and troubled ‘courtship’ of Pentax by Hoya (which is particularly interested in Pentax’s medical instrument technologies). The preliminary merger agreement was developed by Hoya’s president, Hiroshi Suzuki, and Pentax’s president, Fumio Urano, and proposed in December, 2006. However, it was rejected by shareholders because the price offered by Hoya for Pentax shares was too low. A majority of the Pentax board of directors felt Urano had exceeded his authority in signing the preliminary agreement, and all directors save two were against the plan. Urano was forced to resign and a new director, Takashi Watanuki, who had opposed the merger from the beginning, was named Pentax’s president.
Sparx Asset Management, a Tokyo-based investment fund that holds almost 24% of Pentax’s stock, supported the merger and demanded that Watanuki should resign with Urano replacing him. However, this demand was dropped and Nobuaki Tanishima, head of Pentax’s corporate development, became president of Pentax on June 27, 2007. Pentax’s board is said to be optimistic about retaining its independent corporate status and brand name and will continue to focus on precision and optical technologies. However, the president of Hoya is quoted as saying: “Pentax has focused too much on the mass market, where they can’t control price. There is a need to condense the business into niche areas, so that we can improve profit margins.”