KKR & Co. has abandoned plans to acquire the Japanese manufacturer of Yomeishu due to the main shareholder's lack of intention to sell shares.

KKR & Co. (KKR.US) has shelved its plans to acquire the manufacturing company of Yangming Wine, as the largest shareholder of this Japanese herbal supplement manufacturer has no intention of selling its shares. Yangming Wine Manufacturing Co. stated that due to the position of shareholder Yuzawa KK, the company believes the acquisition proposal will not be successful, and therefore terminated exclusive negotiations with KKR. Just half a day earlier, Yangming Wine Manufacturing Co. had confirmed that it had granted KKR exclusive rights to negotiate for the acquisition. According to the documents submitted by Yangming Wine Manufacturing Co. on Tuesday night, the company will continue to negotiate with Yuzawa KK on privatization matters, including any acquisition proposals that Yuzawa KK may put forward. The company stated that any acquisition offer must be higher than KKR's valuation of Yangming Wine at 4021 Japanese yen per share. Yuzawa KK is associated with activist investor Yoshiaki Murakami, and holds 27.99% of the outstanding shares of Yangming Wine Manufacturing Co. Any acquisition bid must receive its approval to be successful. In the documents submitted, Yangming Wine Manufacturing Co. stated that KKR's acquisition bid price may be around 4282 Japanese yen per share. Tuesday is the last trading day of the year in Japan, and Yangming Wine Manufacturing Co.'s stock price surged by 14%, reaching 5480 Japanese yen per share. Earlier reports had indicated that Yangming Wine Manufacturing Co. was in negotiations with KKR. The company's stock price has already increased by 118% this year, with a market value of approximately 90 billion Japanese yen (about 575 million US dollars). A series of corporate governance reforms in Japan have led to an increase in the number of privatization companies, and it is expected that the number of management buyouts by 2025 will reach a historic high. Activist hedge funds are also increasingly disrupting the privatization process in Japan, as they advocate for stronger protection of minority shareholders' rights and pressure to increase acquisition bids and oppose takeover offers to raise stock prices. Yangming Wine Manufacturing Co.'s assets include real estate and cash. The company owns an 11-story office building in the prime location of Shibuya, Tokyo, where its headquarters is also located.