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Posted on November 12, 2021
3 min readLast updated: January 28, 2026
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Eneos and Goldman Sachs launch a $4.2 billion tender offer for Nippo Corp, facing opposition from Oasis Management over the offer price.
By Aaron Sheldrick and Yuka Obayashi
TOKYO (Reuters) -Japan’s Eneos Holdings and Goldman Sachs on Thursday moved ahead with a tender offer for the 43% the refiner doesn’t already own in roadbuilder Nippo Corp, shrugging off opposition from activist Oasis Management to a deal that values all of Nippo at more than $4 billion.
Nippo said in a statement that its board had agreed to the bid, and Eneos and Goldman will start a tender for shares on Friday that will run to Dec. 24.
Hong Kong-based Oasis, which has a 4.5% stake in Nippo, says the price, valuing Nippo at about at 476.4 billion yen ($4.2 billion), is too low and earlier this week said it had received assurances from Eneos, Japan’s biggest refiner, and Nippo that they were open to alternative bids.
Eneos President Katsuyuki Ota addressed that assertion on Thursday, speaking at an earnings conference shortly before Nippo issued its statement. Eneos and Goldman first announced in September they planned to take Nippo private.
“Some shareholders have suggested that the … price should be higher and we are communicating with them, but in the end, it is up to the independent committee of Nippo and the board committee to decide,” Ota said.
Oasis says the offer price of 4,000 yen ($35.37) apiece for Nippo shares undervalues a company with a pile of cash, securities and real estate worth more than $2 billion alone.
Fair value is more like 5,600 yen per share, 28% higher than the Eneos-Goldman offer, it said earlier. The offer from Eneos and Goldman was at a 29% premium to Nippo’s average price over the month before their announcement in September.
Nippo shares fell 1.1% to 4,075 yen on Thursday, while Eneos slumped 2.5% against a wider market gain of 0.6%.
Nippo’s “share price is now about 4,000 yen, but before we started discussing this deal, it was around 3,000 yen and at the beginning of the year it was around 2,500 yen,” Ota said.
“So, we did proper due diligence and referred to other examples of (takeover) premiums,” he said, adding “I’m sure there will be many opinions, so we will communicate with them, but we think it is a reasonable proposal.”
If the tender is successful, the complicated series of transactions would see Eneos owning 50.1% of Nippo and Goldman the rest, with Goldman’s stake potentially later rising to 75% through preference shares and options.
“The buyers are entitled to launch their tender offer,” Seth Fischer, founder and chief investment officer of Oasis told Reuters by email. “The onus is on Nippo’s Special Committee to speak to all interested bidders, as they have assured us they will.”
Oasis previously aired complaints about majority shareholders in Japan steamrolling minority interests, echoing comments from minority investors in Japan over the years.
On Thursday, Ota also said that the bidders had received approval from overseas anti-trust regulators.
Eneos said on Thursday its first-half earnings rose nearly six times to 211 billion yen ($1.9 billion) as rising prices for oil allowed it to book hefty valuation gains and demand for fuel slowly returned from the slumps of the pandemic.
Nippo, a 114-year old, Tokyo-based company that has turned making roads out of tar and gravel into a high-tech business, said its profit nearly halved to 7.6 billion yen.
($1 = 113.0900 yen)
(Reporting by Aaron Sheldrick; Editing by Kenneth Maxwell and Christian Schmollinger)
The main topic is the tender offer by Eneos Holdings and Goldman Sachs for Nippo Corp.
Oasis Management believes the offer price undervalues Nippo Corp.
The tender offer values Nippo Corp at approximately $4.2 billion.
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