Just as the dust finally settles on its four-year battle with Volkswagen, Japanese automaker Suzuki seems to have found another pebble in its shoe.
“U.S. hedge fund mogul Daniel Loeb urged Suzuki to cancel the shares it buys back, saying the Japanese automaker has enough cash on hand and should avoid issuing equity which would hurt existing shareholders.”
Reuters reports that Suzuki has finally been allowed to buy back a 19.9% stake it sold to Volkswagen back in January 2010. But Third Point LLC’s Daniel Loeb – one of Suzuki’s largest shareholders – doesn’t seem to like the idea.
While Suzuki claims it will buy back the shares at a “reasonable” valuation, odds are high that it would repurchase them at Friday’s closing price – 4,151.5 yen per share – a price the famed fund manager deemed a little too high.
Given Loeb’s ability to get what he wants out of companies, even those as secretive and inaccessible as Fanuc, chances are Suzuki might have another fight on their hands.
Loeb however remained mum as to what his end game with the automaker is, saying only that the buy back’s cancellation would be a “first next step,” that he’ll be happy to work with Suzuki’s management, and that at its current valuation, they’ll be “happy to continue holding” its stake. Stay tuned, there’s bound to be more in store here.
Photo: Scott.Symonds