Some readers may be familiar with the Japanese company livedoor and its maverick president Takafumi Horie. This is the guy that grabbed the entire Japanese media's attention this past spring when he attempted a hostile takeover of Nippon Broadcasting System [NBS]. If I had to find his equivalent in the U.S. it would unmistakably be Larry Ellison, CEO of Oracle (ORCL). The reason is, both of them see an advantage to growing via acquisition and will do so regardless of popular opinion. Ellison commented in an interview earlier this year that in some industries such as his (software), consolidation is inevitable and clearly the way to survive is by acquisition. Horie or "Horiemon" as he is often called in Japan is following the same tactic for his internet services company.
The only problem for Horie is that at his company's shareholder meeting just held on the 25th, he had to spend two-hours in a heated debate over whether he would initiate paying a dividend. As it was obvious that paying a dividend was neither on his mind nor a priority, he then had to fend off criticism of him being selfish in not spreading the "shareholder" wealth and at the same time hear outcry calling for his resignation.
There seems to be growing disagreement among shareholders over Horie's strategy and the importance he places on his shareholders. A reported 5,000 shareholders attended this year's meeting, double the attendance of last year's. At any rate, Horie rebuffed this by saying teary-eyed that he has always had the shareholders in mind as he has led the company. He claims to have been pursuing great shareholder value in his attempt to acquire NBS. And he emphasized that the "shareholders own the company."
Despite tremendous dilution of shares in recent years livedoor remains profitable. A shareholder proposal was calling for a 2-yen dividend, which would equal about US$18 million against a net profit of approximately US$132 million reported for the 12-month period ended in September. Horie's salary by the way is about US$1 million annually not including the royalties he receives from books and his other media activities.
Source of shareholder meeting coverage: Mainichi Shimbun