Key Takeaways:
Activist investor Oasis Management is calling on Kadokawa Corp. shareholders to vote against Chief Executive Officer Takeshi Natsuno at the company's June 24 annual general meeting, citing an 89% decline in earnings per share during his five-year tenure.
"After five years of accumulated underperformance, we believe the time has come to stop the decline and call for CEO Natsuno to take responsibility for Kadokawa's failures," Oasis said in a statement. The Hong Kong-based fund, which owns about 13.76% of the Japanese publisher and gaming company, is asking shareholders to vote against Natsuno's reappointment and support a proposal to dismiss him.
Under Natsuno, who took the helm in June 2021, Kadokawa's return on equity slumped to 0.5% from 8.2%, while operating margin contracted to 2.9% from 6.5%. The company cut its fiscal year 2026 operating profit guidance by 38.3% in November and slashed net income forecasts by 57%, then missed even those revised targets in May, according to Oasis. The fund has been a shareholder since 2020 and has engaged with management for six years, advocating for better use of Kadokawa's intellectual property portfolio, including its crown-jewel game studio FromSoftware, creator of the blockbuster title Elden Ring.
The campaign is part of a broader wave of activist pressure on Japanese companies. Shareholder proposals at annual meetings this month reached a record 139, data from Mitsubishi UFJ Trust Bank show, with 19 targeting director appointments — up from 14 last year and seven in 2024. Oasis is also pushing for leadership changes at Kyocera Corp., Tokyo Steel Manufacturing Co. and recruitment firm SMS Co. The Kadokawa board has rejected Oasis's proposals, arguing that continuity is needed to execute a new medium-term plan. Oasis countered that the same leadership that failed to deliver on the previous plan should not be trusted with another six-year term.
Natsuno himself said in February 2023 that if business expansion failed to deliver results, his resignation would "come into view," Oasis noted. The fund has identified potential CEO candidates through independent executive search firms and said it is prepared to introduce them to Kadokawa's board if the vote succeeds.
The outcome of the vote will test whether Japan's corporate governance reforms are giving activist investors real influence. If Oasis succeeds, it would mark the second time in two years the fund has ousted a Japanese CEO, following its 2025 victory at Taiyo Holdings. Investors will watch the June 24 AGM for early vote tallies and any last-minute settlement between the two sides.
This article is for informational purposes only and does not constitute investment advice.
