As Japan’s shipping lines struggle with losses, the chief executives of companies are facing rough seas with fewer shareholders wanting them at the helm.
Eizo Murakami, president of Kawasaki Kisen Kaisha Ltd, Japan’s third-biggest shipping company by market value, is to continue in his job for a second year with only 57 percent of shareholders favoring him, versus 86 percent last year, company records showed on Tuesday.
Support for Junichiro Ikeda, president of bigger rival Mitsui OSK Lines Ltd, tumbled to 77 percent from 98 percent a year earlier.
The vote at Kawasaki Kisen, also known as K-Line, “was a clear sign of dissatisfaction with the management,” said Minoru Matsuno, president of Tokyo-based investment advisory firm Value Search Asset Management Co. “K-Line has plenty of cash, but they are not making the best use of it.”
At K-Line’s shareholder meeting last week, votes against Murakami surged threefold to 330,094 from last year, numbers disclosed by the Tokyo-based company showed.
Hedge fund Effissimo Capital Management Pte Ltd has built up a 34.2 percent stake in K-Line, according to regulatory filings, rising from 6.2 percent in August last year.
Shipping lines worldwide have been battling depressed freight rates and losses as years of overcapacity force them to shrink their workforce and explore consolidation.
K-Line reported its biggest loss in five years in the 12 months ended March and is struggling to return to profit as freight rates slump to record lows.
Mitsui OSK posted a loss of ￥170 billion (US$1.7 billion) last fiscal year, triple that of K-Line’s.
Last week’s Brexit vote is threatening to add to the woes of the broader maritime industry, which includes shipyards, already reeling under the global slump triggered by the collapse in crude oil prices. Currency volatility following the referendum outcome would increase uncertainties in the shipping industry, said Park Moo-hyun, an analyst at Seoul-based Hana Financial Investment Co.
“That could mean investments in shipbuilding and offshore projects could be further delayed, and that’s the last thing they want,” Park said.
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