Shareholders of Livedoor Co. have voted down a proposal for the Internet company to pay a 2 yen dividend because a majority preferred a plan to beef up its internal reserves instead.

Livedoor President Takafumi Horie told the shareholders' meeting in Tokyo on Sunday that boosting internal reserves is indispensable for continuing the company's merger and acquisition activities.

He said his company can benefit shareholders through continued growth, which will push its share prices up.

"We will pay a dividend if it stops growing," he said.

Livedoor has not yet paid a dividend. The company's shares were listed on the Tokyo Stock Exchange's Mothers market for startups in April 2000.

Shareholders meanwhile voted to accept Fuji Television Network Inc. Managing Director Yoshiaki Yamada as a member of Livedoor's board of directors.

As Livedoor and Fuji TV amicably ended their takeover battle in April for radio station Nippon Broadcasting System Inc., Yamada is to represent the TV broadcaster on the Livedoor board.

More than 5,000 shareholders attended the annual meeting, up from about 2,000 last year.

Livedoor also said its securities subsidiary made a profit on Mizuho Securities Co.'s erroneous sell order involving shares of job recruiting company J-Com Co. on Dec. 8.

Livedoor said the firm will return the profits in the same manner as other brokerages that gained from the fiasco.

The Japan Securities Dealers Association asked its member brokerages to relinquish the profits they made through the J-Com trade blunder, which occurred when a Mizuho Securities trader executed an erroneous sell order.