PGM Holdings to Resume Accordia Golf Merger Talks Amid Probe

PGM Holdings K.K. is resuming a plan to merge with Accordia Golf Co., a rival golf operator that’s conducting an internal probe for possible compliance breaches, according to PGM President Arihiro Kanda.

PGM will pursue its plan after Accordia assured it will reshuffle its management to improve internal controls, Kanda said in an interview. PGM withdrew its bid in March when it discovered Accordia’s top management had possibly breached compliance. The two golf operators are based in Tokyo.

Shares of Accordia rose the most in more than a year, climbing 11 percent to 61,500 yen at the close of trading in Tokyo. PGM slipped 0.2 percent to 62,100 yen. The benchmark Topix index fell 0.7 percent.

Accordia President Michihiro Chikubu may have misused about 50 million yen ($618,000) of company funds, according to Ichiro Akimoto, a senior managing executive officer at Accordia. PGM owns 127 golf courses in Japan and reported 70.8 billion yen in sales for the year ended Dec. 31, while Accordia posted 69.9 billion yen in sales from its 133 courses.

“The merger between PGM and Accordia would help us boost profit by seeking scale,” Kanda said. “We can cut costs by eliminating duplication for headquarters and systems.”

Kenichiro Nose, the head of investor relations at Accordia in Tokyo, declined to comment.

Accordia formed a panel to investigate four executives, including Chikubu and Akimoto, for possible rule breaches, according to a company statement on April 17. The committee consists of three outside board members, including a lawyer.

PGM hired Nomura Holdings Inc. as an adviser for the merger.

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