Idemitsu, Showa Shell form alliance as merger bid falters
Showa Shell last December, but the goal of a full merger of the two companies has been delayed due to opposition from Idemitsu’s founding family.
The founding family and related parties, which together hold a stake of a little over one-third of Idemitsu shares, have pledged to block the deal if a vote is held.
Idemitsu director Susumu Nibuya said the company would continue to talk to its founding family but added the company still had no timetable for winning approval from them.
In the statement on the deal, the two companies said the closer cooperation would result in annual cost savings of at least 25 billion yen (RM956 million) within three years starting from last month.
Nibuya said the fight to win cost reductions was to compete effectively against other refiners such as JXTG Holdings , which was formed from the merger of JX Holdings and TonenGeneral Sekiyu and had a domestic petrol market share of more than 50 per cent. Reuters