* Toshiba shares jump after stake purchase by the fund
* Fund says Toshiba stake purchase is for pure investment
* Effissimo unlikely to make aggressive governance demands
(Adds source comment on governance stance)
TOKYO, March 24 Singapore-based fund Effissimo,
which has given embattled Toshiba Corp a rare vote of
confidence with its purchase of an 8 percent stake this month,
on Friday said the holding was for pure investment purposes and
it expected long-term price gains.
The fund, established by former colleagues of Japan's most
famous activist investor - Yoshiaki Murakami, has now become the
largest shareholder in Toshiba, which is caught up in a
multibillion dollar financial maelstrom surrounding its U.S.
nuclear unit Westinghouse.
Effissimo's unexpected purchase sent shares in the Japanese
conglomerate soaring 7.6 percent on Friday, giving it a market
value of 944 billion yen ($8.5 billion). The stock has halved in
value since mid-December, hit by a growing list of financial
woes that have put it at risk of delisting.
"Given the tumultuous background of what's been going on, at
least this brings a degree of something tangible to shareholders
and investors, in relation to the probability of some stability
going forward," said Gavin Parry, managing director of Parry
International Trading in Hong Kong, who does not hold any
Effissimo's purchase of 8.14 percent of Toshiba is worth
about 65 billion yen ($584 million), based on its closing price
on March 15, the date of ownership shown in the filing.
Its stake is "purely for investment", the fund said in an
Effissimo is known for its proactive stance on corporate
governance, but the fund is unlikely to make aggressive moves on
Toshiba, focusing instead on potential gains from the sale of
the conglomerate's prized memory chip business, a person with
direct knowledge of the fund said.
Toshiba has put up most or even all of its memory chip
business for sale to cope with an upcoming $6.3 billion
writedown related to cost overruns at its U.S. nuclear business
and to create a buffer for potential losses down the road. It is
also looking at selling a majority stake in Westinghouse.
"It has bought this big stake in Toshiba when the crisis is
at its worst, and will likely be thinking about how much its
NAND business can be sold for," the source said, on condition of
anonymity. "Even though this is a huge bet, I can't see them
making big demands as a shareholder."
The fund is also the largest shareholder in shipper Kawasaki
Kisen Kaisha Ltd, office equipment maker Ricoh Co Ltd
and electronics retailer Yamada Denki Co Ltd.
Last year, Effissimo urged struggling Japanese electronics
maker Sharp Corp to better explain how it would decide
between a bailout and a buyout.
($1 = 111.4200 yen)
(Reporting by Makiko Yamazaki, Lisa Twaronite and Thomas
Wilson; Editing by Edwina Gibbs and Himani Sarkar)