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Problems at overseas subsidiaries eat at Hitachi

Japanese conglomerate in legal fight with foreign activist shareholder

Hitachi is aiming for 1 trillion yen ($8.94 billion) in sales for its railway business in the medium to long term driven mainly by major projects and acquisitions in Europe.

TOKYO -- Hitachi has been trying to resolve the problem of a parent and subsidiary listing their stocks together in the stock market, but the Japanese electronics maker has been troubled by its Italian unit.

U.S. hedge fund Elliot Management, known as an activist shareholder, acquired a 30% stake in Italian railway signal maker Ansaldo STS, in which Hitachi has a 51% stake, to become a top shareholder. Ansaldo's board is now divided into six directors picked by Hitachi and three picked by Elliot.

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