Idemitsu, Showa Shell form al­liance as merger bid falters

New Straits Times - - Business / World -

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

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