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TOKYO, Feb 14 (Reuters) - Kirin Holdings Co Ltd decided on Friday to oppose an UK-based activist's proposal to buy treasury shares worth 600 billion yen ($5.47 billion), the Japanese brewer and conglomerate said in a statement.
Independent Franchise Partners, which owns a 2% stake in Kirin, has called on the company to focus on beer, sell non-core businesses and use proceeds from sales to buy treasury stocks - a strategy Kirin CEO Yoshinori Isozaki said the company opposed.
"Given the domestic situation such as an ageing and shrinking population, sustainable growth cannot be achieved if we just focus on the beer business," Isozaki told reporters at an earnings briefing.
Beer consumption in the country has more than halved since the 1990s, government statistics show.
To diversify away from the shrinking domestic beer market, Kirin has moved into the pharmaceutical business with affiliate Kyowa Kirin Co Ltd and picked up a 30.3% stake in cosmetics company Fancl Corp.
Kirin said it received a proposal letter from the activist in January and will hold an annual general meeting on March 27.
Activist investors have been gaining momentum in Japan and have complained about what they see as poor performance as well as returns from cash-hoarding firms, with Prime Minister Shinzo Abe advocating strengthening corporate governance.
But companies are often able to ignore minority investors given the longstanding practice of cross-shareholding, where firms hold stakes in each other to cement business ties. ($1 = 109.7600 yen) (Reporting by Takashi Umekawa; Editing by Shri Navaratnam and Himani Sarkar)