Unprecedented Support for Nihon Global Growth Partners’ Proposal at Toyo Suisan’s 2024 Shareholders’ Meeting

Today, notable results were announced from the engagement surrounding the 2024 General Shareholders’ Meeting of Toyo Suisan Kaisha Ltd. (2875.T) (“Toyo Suisan” or the “Company”), held on June 27th.

NHGGP’s shareholder proposal for the Company to disclose its cost of capital garnered 49% support at the Meeting. This is believed to be the highest approval percentage ever for a shareholder cost of capital disclosure proposal in Japan. Given that over 10% of the Company’s shares are owned by cross-shareholders and related parties, NHGGP asserts that it received support from a majority of the “unaffiliated” shareholders. Although this approval rate did not meet the challenging two-thirds approval threshold required for such a proposal, the near 50% support clearly demonstrates a strong desire among shareholders for management to communicate its understanding of the Company’s cost of capital. Shareholders are also seeking a justification for the continued investment in low-return legacy businesses and the accumulation of JPY270 billion in cash and securities.

Additionally, on June 4, 2024, Toyo Suisan announced a JPY25 billion share buyback, its first in 17 years. This followed NHGGP’s shareholder proposal for a JPY20 billion share buyback at the Meeting. NHGGP believes that the Company’s preemptive share buyback was directly influenced by this shareholder proposal and the strong, widespread support for such an action.

NHGGP’s proposal to introduce management stock-based compensation received 22% support at the Meeting, marking one of the highest levels of support for such a proposal.

NHGGP expressed gratitude to all shareholders and other market participants, including the leading international proxy advisors, Institutional Shareholder Services, Inc., and Glass, Lewis & Co., who supported its cost of capital disclosure proposal. NHGGP looks forward to continued engagement with the Company and other market participants in the future.

Nihon Global Growth Partners Management Inc. (“NHGGP”) is a long-term investor in Japanese listed companies that are rapidly growing in markets outside of Japan. Prior to founding NHGGP in 2018, its principals were involved in managing several private equity funds in Japan beginning in 2004. NHGGP manages private investment vehicles, including the NHGGP Japan Opportunities Fund L.P., which was launched in 2021.

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