400 Japanese firms have measures against hostile takeover bids.

TOKYO, Oct. 9 Kyodo

A total of 400 Japanese companies had announced the introduction of measures against hostile takeover bids as of last Friday, an increase from only 27 in 2005, a private institute said Tuesday.

The expansion has come on foreign funds' increasing investment in Japanese firms, as well as May's inauguration of the so-called triangular merger system allowing foreign companies to acquire Japanese firms more easily.

The total accounts for some 10 percent of publicly traded companies in Japan, said Nomura Securities Co.'s Financial and Economic Research Institute.

The number of firms with such measures stood at 34 in the chemical industry, 31 in the electrical machinery industry, 31 in the information and communication service sector, and 29 in the machinery industry. But no firms in the banking, insurance, air transport or mining industries had such measures.

The measures against hostile takeover bids include the so-called poison pill system to issue equity warrants for the purpose of diluting hostile takeover bidders' equity stakes to ward off their bids.

Of the 19 firms that announced plans to introduce the measures, 10 have adopted mechanisms to obtain shareholders' approval on implementation of the measures.

A rising number of companies have been introducing the measures in a bid to pragmatically implement them, said Kengo Nishiyama, a strategist at the institute.

Among such firms, Bull-Dog Sauce Co. introduced and implemented the poison pill system earlier this year to counter an unsolicited tender offer by U.S. hedge fund Steel Partners.