Iwatani Emerges As Cosmo White Knight With Share Buy

Japanese gas company Iwatani Corp has agreed to buy a stake of about 20% in Cosmo Energy Holdings from a group of activist investors, though it is not clear if the country's third-biggest oil refiner has found itself a white knight.

Iwatani will pay ¥105.3 billion ($710.8 million), or ¥6,052 per share, to raise its stake in Cosmo to 19.93% from the current 0.07%, and will buy an additional 0.29% subject to regulatory approval. I Photo: Jasdaq-Liao

Iwatani will pay ¥105.3 billion ($710.8 million), or ¥6,052 per share, to raise its stake in Cosmo to 19.93% from the current 0.07%, and will buy an additional 0.29% subject to regulatory approval, according to an exchange disclosure.

The share acquisition marks an end to Cosmo's high-profile battle with a group led by prominent activist shareholder Yoshiaki Murakami, which had flagged its intention to raise its stake from 20% to nearly 25%.

"This was a very successful exit by Murakami-san and is perhaps the best he could have hoped for," said analyst Travis Lundy of Quiddity Advisors, who publishes on Smartkarma.

"But the lack of a statement by Cosmo regarding Iwatani's stake purchase and its plan to go over 20% indicates the possibility this purchase was neither sought nor planned, and may not be officially welcome," he said. The purchase price represents an 8% premium to Friday's closing price of ¥5,616.

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