×

UPDATE 1-Japan court rejects Idemitsu family petition to block share sale -Nikkei

-Nikkei@ (Changes source, adds founding family appeals, Idemitsu declines to comment)

TOKYO, July 18 (Reuters) - A Tokyo court on Tuesday rejected a petition by Idemitsu Kosan Co's founding family to block the Japanese refinery from issuing as much as $1.1 billion worth of new shares, a lawyer for the family said.

The family has appealed the decision.

The court decision clears the way for Idemitsu to close the share sale, which would dilute the founding family's stake and make it harder for them to prevent a planned acquisition of Showa Shell Sekiyu.

The descendents of the Idemitsu founder argue the culture of the two companies will not mesh and have been locked in a drawn-out battle with the management over the proposed deal.

Earlier this month, Idemitsu announced plans to sell 48 million new shares, equivalent to 30 percent of its outstanding shares, saying it needed to raise funds partly to repay loans.

The founding family quickly sought a court injunction to block the stock sale, which according to calculations by Thomson Reuters would cut its stake to about 26 percent, from more than a third now, eliminating its ability to veto the merger.

Idemitsu declined to comment on the court ruling.

An official at Tokyo District Court public affairs section said it could not provide details because the hearing was a "closed-door" procedure.

Idemitsu has said it would raise up to 124.8 billion yen ($1.11 billion) by issuing the new shares at 2,600 yen apiece.

Payment for the shares is due on Thursday. ($1 = 112.1500 yen) (Reporting by Taiga Uranaka; Editing by Chang-Ran Kim and Himani Sarkar)