The Merger at the Current Share Exchange Ratio is Disadvantageous to Minority Shareholders

Alpine’s Third-party Committee, which rubber-stamped this unfair merger, stated in its Share Exchange Agreement announcement on July 27, 2017:

 “The Third-party Committee considered that the resolution of the board of directors of Alpine for the Share Exchange was not disadvantageous to the minority shareholders of Alpine…”

However, Alpine’s current share price is JPY2,558 per share and is trading at a premium of 17% to the current SER value of JPY2,183 per share. Minority shareholders will lose 15% of their money if the merger goes ahead and as such the merger is disadvantageous for minority shareholders.

Alpine should ask the Third-party Committee to review this decision as occurred in the Hitachi Kokusai takeover summarized below:

-          On April 26, 2017, KKR announced a tender offer for Hitachi Kokusai’s (6756 JP) stock for JPY2,503 per share

-          The offer received backing from a third-party committee in the same way that Alps’ offer for Alpine has

-          Minority shareholders, however, viewed the price as unfair due to the excellent performance of Hitachi Kokusai’s business, and as a result Hitachi Kokusai’s share price traded at a premium to the offer price – the same way that Alpine’s share price is trading at a premium to the SER value

-          On July 31, 2017, Hitachi Kokusai’s stock price was trading at a 14% premium to KKR’s offer, and Hitachi Kokusai’s management asked the third-party committee whether their opinion had changed

-          On August 9, 2017, the third-party committee stated that they still believed that the original offer was fair, however, they could no longer agree that the transaction was not disadvantageous to shareholders

-          KKR subsequently raised the offer price twice in the following months

In Alpine’s case, where the stock is trading at an even higher premium to the offer price and its earnings also beat expectations, a truly independent third-party committee would also realize that the merger at the current SER is disadvantageous to shareholders, and would also demand a more accurate valuation following the revelation of the flaws in SMBC’s valuation as Oasis has described numerous times.

Over the past six months, the average premium has been 15%. In fact, the average premium from March 28th (after record date, until today is an average of 16.5%. Any of the rational mid-term to long- term holders would vote against the proposed transaction, in the interest of their investment.


What can you do about it?

It is now time for Alpine’s minority shareholders to stand up to Alpine and Alps and demand a fair deal. We recommend the following:

  1. Send letters to Alpine and Alps telling them of your dissatisfaction with the offer price.

  2. Sign up for the latest updates from Oasis below to help stay informed.

  3. Attend the Alpine EGM in mid-December 2018 – ensure now through your broker or custodian that you own the shares in your own name so that you can attend the AGM.

  4. Talk to us. What do you think? We want to hear from you. We are reachable at


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