Hedge fund Oasis wants 144-year-old Japanese firm to reinvent itself

Hong Kong

KATAKURA Industries Co, a Japanese company founded more than a century ago, is no stranger to reinvention. Once a silk producer, it has diversified into making underwear, manufacturing fire engines, operating shopping malls and even bee-keeping.

Now, activist hedge fund Oasis Management Co is pushing Katakura to reinvent itself yet again - this time by ditching businesses that don't meet certain profit targets. The Hong Kong-based fund, which owns a 3 per cent stake in Katakura, says the diversity of ventures isn't sustainable and has put forward three proposals aimed at improving profitability at Thursday's shareholder meeting in Tokyo.

These proposals promise to shake up the status quo at Katakura, where tradition reigns and new employees visit its former red brick silk factory, which is now heritage listed, as part of their induction into the company. Katakura will be another test case for Japan's progress on corporate reforms under Prime Minister Shinzo Abe. Activists have scored some victories of late, with New York hedge fund manager Daniel Loeb spurring a restructuring plan at Seven & i Holdings Co in October and winning …