Soft99: Final Round and Three Questions for Decision Day

Two competing tender offers for Soft99 (4464) are slated to close on 13 November (JST). Management’s MBO seeks a two-step take-private at ¥2,680 per share. Effissimo’s seeks to reset governance while keeping the listing at ¥4,100 per share, with no cap on acceptances. The decisive arithmetic is as follows. Effissimo’s group already holds ~4.8%. If it merely meets its minimum of 28.54%, its combined stake becomes~33.34%, clearing the one-third threshold that can block special resolutions — meaning the MBO’s delisting is blocked outright, regardless of any non-tender commitments.

As we head into the deadline, the outcome turns on three questions — answers we may see tomorrow if neither bidder extends nor changes terms:

1. Will sellers converge on the higher, unconstrained bid? Effissimo pays over 50% more per share than the MBO(¥4,100 vs ¥2,680) and accepts all shares if its minimum is met. Does that combination of higher price, easier to meet minimum than MBO, and no acceptance cap draw sufficient tenders to clear its threshold and shut the door on the MBO’s delisting plan?
2. How will “non-tender” holders explain standing pat at a lower price — if they do at all? Their stance raises stewardship questions: with a clearly superior competing price on the table, what rationale contractual or fiduciary will non-tender holders present for not tendering or for maintaining prior undertakings? For that matter, what rationale will anyone outside of the MBO group present for not taking the higher offer?
3. Do long-term strategy narratives sway investors who won’t be shareholders after settlement? Both offers have no upper limit; this means that any and all tenders exit. For sellers, post-closing strategy and board composition should be secondary to price and closing probability. Do those narratives nonetheless keep enough investors on the sidelines to influence who meets their minimum — or does the market treat this primarily as a price × probability decision?

By this time tomorrow, we should learn how the market balances price discipline, closing certainty, and governance preferences in a live two-sided contest. If Effissimo meets its minimum, its stake crosses one-third and blocks the MBO’s delisting; if Effissimo falls short, management’s take-private regains plausibility. Either way, the result will be telling and give us insight into the state of mind and heart of the current Japanese market.