The president of Hokuetsu Paper Mills Ltd., the target of an unprecedented hostile takeover bid by Oji Paper Co., said Wednesday it is ready to negotiate with Nippon Paper Group Inc. about forming a business alliance.

"Nippon Paper, in comparison with Oji, respects our intention to seek independence," Hokuetsu President Masaaki Miwa told a news conference at its head office in Tokyo. "We will discuss which specific areas we can cooperate on."

On Tuesday, second-ranked Nippon Paper acquired an 8.85 percent stake in Hokuetsu, the nation's sixth-largest paper producer, in an effort to block Oji's takeover plan.

Nippon Paper said it wanted to form cooperative ties with Hokuetsu and leading trading house Mitsubishi Corp., which is now Hokuetsu's biggest shareholder.

After Oji launched the takeover bid, Hokuetsu issued new shares worth 30 billion yen to Mitsubishi, giving it a 24 percent stake in terms of voting rights.

Mitsubishi and Nippon Paper now hold a combined 33 percent stake in Hokuetsu, which will make it difficult for Oji to take control.

"I am very confident" that Hokuetsu can foil Oji's takeover plan, Miwa said.

Oji, the nation's largest paper producer, launched the unprecedented takeover bid on Aug. 1, offering 800 yen per share. The offer is good through Sept. 4.

Oji wants a controlling stake of more than 50 percent in Hokuetsu, which it says will help produce synergies to expand business and streamline operations to survive intensifying international competition.

Hokuetsu repeatedly rejected the offer and said that integrating with Oji will only damage its business. Hokuetsu branded the tender offer as self-serving because Oji is expected to be the only party to benefit from the acquisition.

An independent panel Tuesday recommended that Hokuetsu adopt a poison pill defense against Oji's takeover bid.