Fukushima Retiree to Lead Anti-Nuclear Motion at Tepco AGM

Fukushima Retiree to Lead Anti-Nuclear Motion
Masafumi Asada, right, a 70-year-old resident of Fukushima prefecture, will speak on behalf of 402 shareholders tomorrow at the annual general meeting of the utility known as Tepco, to ask it to stop atomic generation. Photographer: Tomohiro Ohsumi/Bloomberg

Masafumi Asada bought shares of Tokyo Electric Power Co. almost a decade ago with a single purpose: To vote against the use of nuclear power.

Asada, a 70-year-old resident of Fukushima prefecture, the epicenter of Japan’s nuclear crisis, will speak on behalf of 402 shareholders tomorrow at the annual general meeting of the utility known as Tepco, to ask it to stop atomic generation.

“Even if our proposal doesn’t go through, I will still hold the stock,” said Asada, whose 1.6 million yen ($20,000) investment in 800 shares 10 years ago has shrunk to about 12 percent of the original value. “I bought the stock to protect our lives, not to make money.”

Almost $37 billion of Tepco’s market value has been erased since the March 11 earthquake and tsunami knocked out the Fukushima Dai-Ichi plant, causing meltdowns in three reactors. The catastrophe, the worst nuclear accident in 25 years, displaced 50,000 households after radiation leaked into the air, soil and sea.

A group of shareholders has been proposing the motion to stop Tepco from using atomic energy for the past two decades, each time failing at the annual meeting. The 21st attempt this year may see some support after more than 60,000 people marched in demonstrations in Tokyo, Osaka, Hiroshima and Fukushima on June 11, local media said.

Tepco has opposed the proposal of withdrawing from nuclear power generation, saying that it’s a matter for the board.

Dai-ichi Life

Dai-Ichi Life Insurance Co., Tepco’s second-biggest shareholder after Japan Trustee Services Bank, booked a 110.4 billion-yen charge for the three months ending in March, mainly for losses on the utility’s stock, it said.

At its annual general meeting today, the insurer said it hasn’t received any formal request for support from Tepco. Any future loans would depend on factors including the government’s plans to compensate victims of the nuclear accident and prospects for the utility’s future business, Hideto Masaki, executive vice president at Dai-ichi, told shareholders.

Sumitomo Mitsui Financial Group Inc. has no plans to sell its 2.2 percent stake in the utility or forgive its loans or interest, said Takeshi Kunibe, chief executive officer of Sumitomo Mitsui Banking Corp., the banking unit of Japan’s second-biggest lender by market value.

Tepco shares rose 2.6 percent to 316 yen at the 3 p.m. close in Tokyo. They have lost 85 percent since the quake.

Compensation Claims

Earlier this month, the Cabinet approved a disaster compensation bill to help Tepco pay reparations with the support of a third-party organization. Tepco may face as much as 11 trillion yen in compensation claims, according to Bank of America Corp.’s Merrill Lynch unit.

The cost of dismantling the Fukushima plant may reach 20 trillion yen, and compensation for households in a 20-kilometer evacuation zone may total 630 billion yen over 10 years, according to the Japan Center for Economic Research.

A group of banks led by Sumitomo Mitsui Financial advanced 2 trillion yen of emergency loans to Tepco.

“Perhaps the best solution would be to spin off all of the non-core assets, real estate and subsidiaries into a separate company for liquidation to pay for the damages,” said Curtis Freeze, founder of Honolulu-based Prospect Asset Management Inc., which manages $300 million. “Otherwise the shareholders will expect Tepco to do as little as possible.”

Riot Police

The National Police Agency plans to send riot squads and 150 officers to the meeting at the Prince Park Tower Tokyo Hotel to quell any protests, said a police official who declined to be identified, citing the agency’s policy.

Tepco has prepared seats for 5,600 shareholders at the central Tokyo hotel, said Tetsuya Terasawa, a spokesman. Last year, the utility had a record attendance of 3,342 investors, he said. The longest shareholders’ meeting was in 1999, which lasted 3 hours and 42 minutes, according to Tepco.

“Shareholder interest has increased after the accident, so we prepared more seats,” Terasawa said. “It will depend on our shareholders how long the meeting will last.”

The company had 933,031 shareholders as of March 31.

At the meeting, shareholders will vote on the appointment of 17 board members, including newly named President Toshio Nishizawa, 60, and Chairman Tsunehisa Katsumata, 71. Sixteen of the 17 directors are Tepco executives, company documents show.

Outside Director

The lone outside director, Yasushi Aoyama, has received remuneration from a Tepco unit for two years in the past, according to the documents. Aoyama is a former vice-governor of the Tokyo Metropolitan Government and has experience in urban planning and crisis management, the company said.

U.S. proxy adviser Glass Lewis & Co. is recommending shareholders vote against all nominees, citing a lack of independent members to carry out the company’s risk management oversight. Instead, independent directors that may change the way it operates should be appointed, Naomi Stroud, an analyst at San Francisco-based Glass Lewis, wrote in a June 13 report.

“The company has experienced significant problems with its safety practices and risk management, wreaking havoc on surrounding communities, destroying shareholder value as well as tarnishing its reputation,” Stroud wrote. “The appointment of new, independent directors untainted by prior safety lapses and poor communication would provide better oversight of the company on behalf of shareholders as well as stakeholders.”

New Auditors

Tepco will also propose the appointment of two new auditors, both from within the company, Executive Vice President Makio Fujiwara and Yoshihiko Matsumoto, the company’s head of accounting.

Some institutional investors are selling shares of utility companies because of the risks associated with nuclear power.

STB Asset Management Co. said in April it’s removing Tepco stock from its socially responsible investing fund, citing environmental and health concerns following the accident.

Asada, the retired shareholder, moved from Tokyo with his wife 17 years ago to Tamura city, about 25 kilometers from the Dai-Ichi plant in Fukushima, to grow rice, carrots and shiitake mushrooms.

Shortly after, Tepco announced plans to expand the Dai-Ichi station with two more reactors, leading to his involvement with the local anti-nuclear movement.

“Instinctively, I thought this could lead to trouble,” said Asada, a former computer engineer. “I moved to start a second life here, but that’s completely turned upside down and we’re left here wondering if I have to look for another home.”

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