Electric Power Development Co., the country's biggest electricity wholesaler, said Wednesday it will raise its annual dividend by ¥10 — to a total of ¥70 per share — for fiscal 2007, spurning repeated calls by a U.K.-based hedge fund that it double the annual payout to shareholders.

For the latter fiscal half to March 31, the utility, better known as J-Power, will pay ¥40 a share, compared with the ¥30 it proposed for fiscal 2006.

J-Power has been under pressure from its biggest shareholder, The Children's Investment Fund (TCI), to raise its corporate value and offer a higher return.

Last month, TCI requested that the annual dividend be increased to between ¥80 and ¥120 from the ¥60 that J-Power paid out in fiscal 2006.

"We will probably square off" with TCI at the shareholders' meeting, President Yoshihiko Nakagaki said at a news conference in Tokyo to release the firm's annual earnings results. "I'm confident that we can gain the understanding of shareholders."

Nakagaki flatly denied that the decision to increase the dividend had anything to do with TCI's demand. He said the ¥10 hike was the appropriate level based on the company's achievement of management goals and profit outlook.

J-Power's board also rejected other demands proposed by TCI last month, including the appointment of outside directors, an outlay of ¥70 billion to buy back shares and putting a limit on cross-shareholding.

The fund will seek a vote on the proposals at the shareholders' meeting in late June and said it would oppose Nakagaki's reappointment if the recommendations are denied.

The fund found no ally in the government, which last month rejected its bid to raise its 9.9 percent stake in J-Power.

J-Power's annual net income fell 16.7 percent to ¥29.3 billion from a year earlier while sales rose 2.5 percent to ¥587.8 billion.