Preparation of company acquisitions in top secret
Sangyokumiaichuokai (general association of cooperatives) leaders who tried to run the insurance business. From right of front row, president Yoriyasu Arima, vice president Kotaro Sengoku.From left of back row, vice president Kanji Sato, managing director Michinosuke Hamada (from “Recollection of Seventy years”).
In September 1939, one person with knowledge of the insurance industry came to visit Toyohiko Kagawa, who was claiming start of cooperatives insurance. The person informed Kagawa that Tsuneo Kanemitsu, Colonial Affairs minister and member of the House of Lords, could put for sale his managing New Nippon Fire & Marine Insurance Co., Ltd. Kagawa had been wished insurance company keenly. The person said, “Would you buy it?”
Kagawa immediately reported this story to vice president Kotaro Sengoku and managing director Michinosuke Hamada at sangyokumiaichuokai (general association of cooperatives). He also reported this story to president Yoriyasu Arima. Thinking “opportunity coming,” leaders of sangyokumiai (cooperatives) went into the survey on the insurance company acquisition. In December, the story developed further. Colonial Affairs minister Kanemitsu had decided to transfer to sangyokumiai (cooperatives) regarding his managing three insurance companies such as Taisho Life Insurance Co., Ltd., Japanese Education Life Insurance Co., Ltd., and New Japan Fire & Marine Insurance Co., Ltd.
Kenzo Matsumura (provided by Sakuradakai, general incorporated association)
On 7 January of following year, staff discussed with lawyer of sangyokumiai (cooperatives) and created contract draft. On 8, sangykumiai leaders visited Colonial Affairs minister Kanemitsu at the Ministry of Colonial Affairs and went into the negotiations. On the other hand, sangyokumiai had planned the establishment preparation committee for the National Mutual Aid Association for Officers and Employees of Sangyokumiai (cooperatives) scheduled for 9 January, which was planned to be chaired by president Arima, in order to discuss on retirement salary system and so on.
This establishment preparation committee had also owed mission to promote the study of the acquisition method and the insurance business after the acquisition regarding three insurance companies they planned acquisition. As a result, they decided to buy all of the shares, management rights, and marketable securities of the 3 companies in 700 yen. For the time being, regarding payment of contract deposit, they decided that sangyokumiaichuokai (general association of cooperatives) would pay 2 million yen and shinyokumiairengokai (federation of credit cooperatives) would pay 200 thousand yen. At a later date, all members of the committee visited Kanemitsu’s House, paid contract deposit, and received the shares so that acquisition negotiations were terminated. It was just 4 months from the provision of information to Kagawa. The movement was so rapid.
On 21 the same month, the National Meeting of Presidents of Federations of Credit Cooperatives was held in Marunouchi, Tokyo. President and vice president of sangyokumiaichuokai (general association of cooperatives) and Kagawa were invited by the guests. The meeting unanimously passed contents of acquisition agreement and allocation of funding. If leakage to the outside occurred, rebellion was inevitable. Paying close attention, they progressed surreptitiously. Insurance business run by sangyokumiai (cooperatives), which Kagawa had demanded for a long time, seemed as if realized finally.
A problem that was exposed in the Parliament question
At that time, the 75th Imperial Parliament was opened. In Budget Committee of the House of Representatives, on 9 February, Kenzo Matsumura (1883 – 1971) familiar with agricultural policy was standing for asking the question. Against Agriculture Minister Toshio Shimada (1877 – 1947), he asked the question on the acquisition problem of the three insurance companies.
“Recently, according to the rumor, sangyokumiaichuokai (general association of cooperatives) and shinyokumiairengokai (federation of credit cooperatives) are progressing acquisition of life insurance company and fire insurance company. But isn’t it beyond the scope of sangyokumiai (cooperatives)? In addition, if targets of acquisition were not prestigious companies, it would be a management problem.”
Because acquisition was progressed secretly, it surprised the Ministry of Agriculture and Forestry in charge of supervisory authority of sangyokumiai (cooperatives), and the Ministry of Commerce in charge of supervisory authority of the insurance business. Daily newspaper had sparked to write the insurance company acquisition problem of sangyokumiai (cooperatives), while using a half-page of the morning paper all at once. The commercial insurance industry was also shocked.
Fearing anti-sangyokumiai (cooperatives) movement by commercial and industrial enterprises, sangyokumiai (cooperatives) leaders proceeded to secretly. But imperceptibly it had been leaked to the anti-sangyokumiai (cooperatives) side. If the lawmaker of the anti-sangyokumiai (cooperatives) faction asked the question, it might be regarded as the mere extension of the anti-movement. Anti-sangyokumiai (cooperatives) side seemed to have taken aim at Matsumura, because question by Matsumura, seen as supporters of sangyokumiai (cooperatives), would cause a considerable effect.
Two days ago, before Matsumura to questions in parliament, the meeting for economic editors of daily newspaper was held. Agenda was the handling of this problem. Each newspaper’s attitude was determined in advance here. It was preparation by the newspaper for public awareness. Propriety of acquisition and purchase price was questioned in Imperial Parliament, so that Ministry of Agriculture and Forestry was struggling. A series of scenario, which was consisted of start of parliamentary questions, continued to newspaper reports, and finally finished by public awareness, was completed.
A few lawmakers of House of Lords such as Miyakichi Itaya (1857 – 1924, president of Itaya Life Insurance Company) at the side of commercial insurance were said to have agitated the anti-sangyokumiai (cooperatives) lawmakers of House of Lords and House of Representatives. Insurance companies acquisition problem of sangyokumiai (cooperatives) had become a political issue.
Reference = Kazumi Iwao “Mutual aid and reconstruction of rural village, historical expansion of commercial insurance and cooperatives insurance and contemporary significance of cooperatives insurance system (first volume)” Management Practice ( 1st September 2015 issue), Taiichi Kurokawa “A path in the desert, 50 years of medical care and mutual insurance movement,” Ienohikarikyokai, National Mutual Insurance Federation of Agricultural Cooperatives ed. “Evolution History of Agricultural Cooperatives Mutual Insurance” the Federation, Kojiro Sakai “History of Mutual insurance Business” Japan Cooperatives insurance Association Incorporated