M&A Consulting – a shareholder activist fund – has written a letter calling on Sankyo shareholders to block its proposed $8 billion dollar merger with fellow Japanese firm, Daiichi, saying they should “seriously reconsider the [deal’s] legitimacy.”

In the letter, Yoshiaki Murakami, president of M&A Consulting, said that shareholders had not yet been given a clear explanation on how the merger, which was revealed in February this year [[25/02/05a]], would increase shareholder value, and subsequent meetings with the Sankyo president, Takashi Shoda, had not satisfactorily clarified the issue. In addition, Mr Murakami notes that Sankyo’s share price has dropped by around 15% since the merger was first announced.

“With the high premium Sankyo shareholders are forced to pay to Daiichi shareholders, it seems as if Sankyo management is trying to preserve their positions by sacrificing Sankyo’s own shareholder value,” Mr Murakami added, urging his fellow shareholders to “seriously reconsider the legitimacy of this integration… and take appropriate actions at the shareholders meeting.” The meeting is scheduled to take place on 29 June.