Yahoo Finance Sumitomo Shares Jump After Elliott Reported to Build Stake
(Bloomberg) -- Sumitomo Corp. shares surged by the most since August 2020 after activist investor Elliott Management Corp. was said to have built a “large” stake in the Japanese trading house.
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The stock jumped as much as 9.1% Tuesday in Tokyo, leading its peers higher. The size of Elliott’s investment is around “several tens of billions of yen,” according to a person familiar with the matter. The company has engaged with Sumitomo and shared its views on ways to create shareholder value, the person said.
“The stake makes a lot of sense and seems like a relatively easy win for Elliott because there is reasonable potential to be extracted without needing any complicated gymnastics here,” said Mio Kato of LightStream Research. “Elliott could easily drive a significant improvement in governance and shareholder returns.”
Other trading houses also climbed, with Mitsubishi Corp. advancing as much as 3.6%, Marubeni Corp. gaining 4.9% and Mitsui & Co. advancing 3.7%. Itochu Corp. rose 3.4%.
Japanese trading houses’ shares have surged to records since Warren Buffett said a year ago that he would be raising his holdings in them. In February, he said in his letter to investors that the companies follow shareholder-friendly policies that are “superior” to those practiced in the US.
(Adds share moves of other trading firms in fourth paragraph)
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