Markets Jan 24

Toshiba regains Tokyo exchange's top status amid better governance calls

The Japanese firm had been relegated to the exchange’s second division after its nuclear power business’s liabilities had exceeded its assets 

by Makiko Yamazaki
Toshiba regains Tokyo exchange's top status amid better governanc
Toshiba will move back to the exchange's first section on Friday. Photo: Reuters

The Tokyo Stock Exchange has approved Toshiba Corp's return to the bourse's first section as there are calls from some shareholders for better governance at the Japanese industrial conglomerate.

Toshiba, which filed an application for the return in April last year, will move back to the first section on January 29. The company has said the return could help lure buying from investors in stock indexes.

The Japanese company was relegated to the second section in 2017 after massive writedowns at its US nuclear power business caused liabilities to exceed assets – a condition for automatic demotion.

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The TSE's decision comes as two large shareholders – Singapore-based Effissimo Capital Management and U.S. hedge fund Farallon Capital Management – demand an extraordinary shareholders meeting for governance-related issues.  

Effissimo Capital has called for an investigation into Toshiba's annual general meeting held last July, at which the company said the voting rights of several shareholders were compromised.

Farallon Capital is asking the firm to seek shareholder approval over what the fund said is a change in investment strategy.

  • Reuters

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Toshiba japan Tokyo Stock Exchange writedowns Effissimo Farallon