Verification of the benefits of cross-held shares against the cost of capital
First written in FY2019. 1 of 4 entries say "Advanced", first in FY2021. Latest entry: FY2026.
- FY2026Cost-of-capital benchmark changedAnnual report
「For these cross-shareholdings, the Board of Directors regularly conducts a detailed review of each issue to assess whether the benefits of holding it relative to its acquisition cost, comprising dividends received and profits from business transactions, and the associated risks are commensurate with our cost of capital (WACC set at 7%), and whether the holding contributes to increasing enterprise value. Holdings deemed unjustified will be sold as appropriate, and we will work to reduce cross-shareholdings.」
The company disclosed a 7% WACC as the verification benchmark for cross-held shares. It holds 13 unlisted holdings and 22 listed holdings. - FY2024RestatedAnnual report
「For these cross-shareholdings, the Board of Directors regularly conducts a detailed review of each issue to assess whether the benefits of holding it relative to its acquisition cost, comprising dividends received and profits from business transactions, and the associated risks are commensurate with our cost of capital (WACC set at 6%), and whether the holding contributes to increasing enterprise value. Holdings deemed unjustified will be sold as appropriate, and we will work to reduce cross-shareholdings.」
The company continues its policy of verifying cross-held shares using a 6% WACC and other criteria and selling holdings that lack economic rationale. - FY2021AdvancedAnnual report
「Number of holdings (holdings) Unlisted shares 12 Shares other than unlisted shares 24 (Holdings whose number of shares decreased during the fiscal year) Shares other than unlisted shares 6」
The company continues to compare cross-held shares with a 6% WACC and verify them at Board of Directors meetings, and sold 6 holdings other than unlisted shares during the fiscal year. - FY2019First statedAnnual report
「For each cross-shareholding, we assess the rationale for holding it by comparing and verifying the benefits of holding it relative to its acquisition cost, comprising dividends received and profits from business transactions, against our cost of capital (current WACC: 6%). We consider selling holdings whose rationale has weakened as appropriate. In addition, the Board of Directors regularly scrutinises the benefits of holding every issue and determines whether continued ownership is appropriate.」
For cross-held shares, the company has disclosed a method of periodically verifying them at Board of Directors meetings by comparing dividends received and profits from business transactions with a 6% WACC.