Isetan Singapore

Minority investors are working very hard now trying to get Isetan Singapore to pay $2 special dividend to take advantage of S44 tax credits.

It is reported that Isetan Tokyo would have to pay a higher tax in Japan on dividend received from Singapore. Thus Isetan Singapore, 61% subsidiary of Isetan Tokyo, has been very very nimble in paying less than 2% dividends over the year.

Discussion with Isetan management has not resolved conundrum.

It was noted that capital appreciation for this counter over 25 years is estimated at only 57%. Hmm .. has Isetan Singapore been listed in Singapore for so long? "1981", said Mr How Kok Kooi, now 70 years old.

By listing in Singapore, Isetan Tokyo must have obviously done so after considering its tax advisers. It is costly to receive foreign dividends.

Then how does Isetan Tokyo justify its involvement in Singapore?
Isetan Singapore pays royalty fees to Isetan Tokyo ie. a percentage of turnover (regardless of whether Isetan Singapore makes money or not).

The 61% shareholder gets paid a percentage of turnover every year (wonder how many percent), while the remaining 39% shareholders have been getting less than 2% (on par value or share price?) over the 25 years?

Is it really like that?

Next question - Now that Isetan Singapore has some accumulated profits over the year, what is the modus operandi of Japanese companies with foreign subsidiaries in dealing with cash cows given the tax structure in Japan?

P/S - I don't own any Isetan shares.
Share price as of 29 Dec 2006 - $5.20 at PE of 22.1