Mitsubishi UFJ Financial Group Inc said on November 21 that it had agreed to pay 2.5 billion yen (21.2 million dollars) to Sumitomo Trust and Banking Co to settle a two-year legal battle over the scrapping of a partial merger in favour of a deal to create the world's largest bank.
Sumitomo Trust had an agreement in principle in May 2004 to buy the trust banking unit of then UFJ Holdings Inc which was buckling under a mountain of bad debts.
But in a merger battle that was unusually bitter by Japanese standards, UFJ later abandoned the plan in favour of a full merger with the Mitsubishi Tokyo Financial Group to create the world's largest bank by assets.
Mitsubishi UFJ Financial said in a statement that it had paid the settlement money to Sumitomo Trust and Banking on the recommendation of the Tokyo High Court, bringing an end to the litigation.
Sumitomo Trust had initially requested 100 billion yen in damages, a claim that was rejected by the Tokyo District Court in February. Sumitomo then filed an appeal seeking reduced damages of 10 billion yen. Japan's Supreme Court in 2004 cleared the way for UFJ and Mitsubishi Tokyo Financial Group to merge, rejecting a bid by Sumitomo Trust to halt the deal.
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