Steel Partners Japan Strategic Fund is urging shareholders of Sapporo to support the election of its ten-person slate to Sapporo’s board of directors at the company’s annual general meeting scheduled for 30 March 2010.
Steel Partners has also called for shareholders to reject six of the company’s incumbent management nominees, including president and chief executive Takao Murakami, whose mismanagement of the company has resulted in Sapporo’s loss of market share and profitability.
Steel Partners is seeking the support of Sapporo’s shareholders for Steel Partners’ six director-nominees and four incumbent directors whom Steel Partners supports for re-election to the board at the 2010 AGM.
“Under Mr. Murakami and the current board, Sapporo’s performance has deteriorated and continues to lag its competitors. During this time, Sapporo has fallen into last place among the four major Japanese brewers,” says Warren Lichtenstein (pictured) of Steel Partners.
Steel Partners cites the following failures that have occurred under the current board’s stewardship of Sapporo:
• Repeatedly missing budgets
• Dropping to last place among Japan’s four largest brewers in terms of market share
• Meager profitability that is one-third of its competitors, Kirin and Asahi
• Allowing Suntory to overtake Sapporo as the leader in the super-premium beer segment
• Sapporo’s stock price has fallen more than 46 per cent since January 2008, worse than both Asahi and Kirin
• Failed to achieve the Pension Fund Association of Japan’s requirement that portfolio companies achieve annual ROE of eight per cent at least once in a three-year period for PFA to support the re-election of incumbent directors
“Sapporo shareholders deserve better,” Lichtenstein adds. “Shareholders are the only group that is capable of making the changes to the board that are desperately needed to revive Sapporo. Therefore, we urge all shareholders to vote for our nominees on Proposal 5 and against Mr. Murakami and other incumbent management directors.”
Four proxy advisory firms, Japan Proxy Governance, RiskMetrics, Glass Lewis and Proxy Governance, recommend that shareholders elect all or nearly all of the shareholder nominees.
