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Report: Activist shareholder urging Dai-ichi Life to off-load stock portfolio

Hong Kong-based Argyle Street Management Ltd. is pushing Dai-ichi Life Holdings Inc. to off-load its large stock portfolio and use the proceeds to buy back ¥1 trillion to ¥1.5 trillion of its own shares, The Wall Street Journal reported Oct. 11.

Argyle claims that Dai-ichi Life's shares are "undervalued" and urged the Japanese life insurer to actively pursue the approach suggested in an Oct. 5 letter. The activist shareholder said people may view Dai-ichi Life as higher-risk because of the large stock portfolio, which could be more volatile compared with others.

Argyle reportedly owns less than 1% of Dai-ichi Life's outstanding shares, but it could gain the support of other shareholders. The activist shareholder claims that Dai-ichi Life's equity portfolio underperformed a Japanese equity benchmark over the past 10 years. The Journal noted that Dai-ichi Life's investment in Japanese equities is at 11% of its assets, a bigger proportion than its listed Japanese peers.

Dai-ichi Life expressed willingness in continuing dialogue with its shareholders. However, it declined to discuss the view of any particular shareholder and refused to comment on the proposed share buyback, according to the report.

As of Oct. 11, US$1 was equivalent to ¥112.21.