GungHo Online Faces Shareholder Backlash Amid Calls for CEO Removal

GungHo Online, the company behind Puzzle & Dragons, is dealing with a shareholder uprising that could potentially lead to the ousting of its CEO, Kazuki Morishita. This move comes after a 32-page report was submitted to the company in January by Strategic Capital, a shareholder, urging GungHo to improve its performance. Recently, another shareholder, Intertrust Trustees (Cayman) Ltd, has requested an extraordinary general meeting to reconsider the company's requirement for a two-thirds majority vote to remove a director, rather than the standard 50% majority. This meeting also aims to hold a vote on removing Morishita from his position. Together, these two shareholders own approximately 8% of GungHo's stock. Their concerns stem from the company's lackluster studio performance, both in terms of output and share price, as well as their low confidence in Morishita's management and the perception that he has made GungHo a 'one-hit wonder.' Additionally, they take issue with Morishita's compensation package. In response, GungHo stated that the petitioners believe the company's corporate governance and shareholder value could be improved by allowing directors to be removed by a simple majority vote at a shareholders' meeting. As a result, they are requesting Morishita's removal as a director and have asked for an extraordinary general meeting to be convened before the upcoming annual general meeting, where proposals for the election of directors are set to be presented. The company has announced that it will carefully review the request and disclose its response policy once it has been determined.