Benihana’s shareholders served up a defeat yesterday to the heirs of company founder Rocky Aoki.
Investors approved the Japanese steakhouse chain’s controversial capital-raising plan, despite last-minute pleas by Aoki’s descendants, who said the measure would water down their shares while protecting the stakes controlled by several board members.
Management wants the company to merge with a subsidiary called BHI Mergersub, so Benihana can issue 12.5 million additional shares. The company said it may not issue the stock, but needs the option in case of future money woes.
The children were supported by New York hedge fund Coliseum Capital, the largest holder of Benihana’s Class A shares, and even Rocky’s widow, Keiko Aoki. One unexpected outcome is that the battle may help mend the longtime rift between Rocky’s children and Keiko, his third wife.
Benihana declined to reveal the exact tally of the vote, but sources said it was a close call.
People close to Rocky’s heirs said the family is “assessing their options,” but added that legal action is unlikely as the children — who are the company’s largest shareholders — are hoping to work with management.
Benihana didn’t respond to a request for comment.
The meeting, which took place at a Westin hotel in Fort Lauderdale, Fla., was often tense, sources said. Kevin Aoki, Rocky’s son from his first marriage, slammed management for asking for “a blank check.”
After the meeting, the children spoke to Keiko, one person said. “I don’t know if I want to say it was healing, but it was very positive.”