Tokyo Gas is exploring options to enhance the value of its real estate assets, including the potential sale of underutilized properties, following pressure from an activist investor. President Shinichi Sasayama indicated that the company aims to improve capital efficiency and plans to raise its mid-term return-on-equity target of 8% once achieved.
Tokyo Gas Co., Japan's largest gas company, is under scrutiny regarding its extensive real estate portfolio, valued at approximately $9.7 billion by Elliott Investment Management. This portfolio reflects a common trend among Japanese utilities, which historically owned significant urban properties to maintain proximity to consumers, similar to peers like Osaka Gas and Kansai Electric Power.
Tokyo Gas Co. shares surged 15% in early trading, marking the largest increase since 1987, following news that Elliott Investment Management acquired a 5.03% stake in the company. Elliott plans to propose significant changes, including the sale of assets like the Park Hyatt Tokyo hotel, to enhance capital efficiency.
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