Mitsui Fudosan's stock price reaches a new high after Elliott reportedly recommends a $6.5 billion share buyback.

• Japan's largest property group was urged by Elliott Management to launch a 1 trillion yen ($6.74 billion) buyback plan.
• According to the report, Elliott demanded that the company sell its $3.6 billion stake in Oriental Land, which operates Tokyo Disneyland.
• "Mitsui Fudosan, previously untouchable elite companies, are now being targeted by Monex Group's Jesper Koll," he said.

On Monday, shares of surged to a record high after a report indicated that U.S. activist investment firm Elliott Management had called for a significant stock buyback program.

In early afternoon trading, Japan's largest property developer experienced a significant increase of up to 11.8%, reaching a new record high of 4,100 yen.

The property group was urged by Elliott Management to implement a 1 trillion yen ($6.74 billion) buyback plan, as reported by the Financial Times.

According to sources, Elliott also requested that the company divest its $3.6 billion stake in Tokyo Disneyland, which is owned by Mitsui.

Corporate Japan is now under immense pressure to improve its balance sheets, as previously untouchable elite companies, such as Mitsui Fudosan, are being targeted, according to Jesper Koll, expert director at Monex Group, who spoke to CNBC.

Mitsui Fudosan's ownership of Oriental Land is "little sense," according to Koll, and Elliott's demand for a sell-down could result in more efficient use of proceeds.

The question is whether the proceeds from a sell-down should be used for a share buyback, as Elliot demands, or whether Mitsui's leadership team should become a more aggressive investor in future growth projects, according to Koll.

Following the news, Oriental Land's shares dropped by 2.2%. LSEG data shows that Mitsui owns a 5.4% stake in Oriental Land, making it the company's second largest shareholder.

According to LSEG data, as of September 2023, Oriental Land was Mitsui's largest holding, comprising 61.2% of its portfolio.

In the past six months, Oriental Land has sold off 16.6% of its stake, as indicated by data from LSEG.