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Toyota will take a group supplier - Toyota Industries - private in a deal valued at £33bn, the companies have said.
The move, led by Toyota Motor chairman Akio Toyoda, aims to strengthen the founding family's control over the business empire and aligns with Japanese government efforts to unwind cross-held shares.
Akio Toyoda is expected to make a personal investment, alongside Toyota Motor's contribution.
Founded by Toyoda's great-grandfather, Toyota Industries supplies textile looms, forklifts, and car parts.
In order to privatise Toyota Industries, a new holding company will be established. Toyota Fudosan, whose shares are held by Toyota Group companies, will invest approximately 180 billion yen for the purpose of collaboration and cooperation with Toyota Group. Akio Toyoda will invest 1 billion yen as a commitment to the transactions. Additionally, Toyota Motor will invest approximately 700 billion yen in non-voting preferred shares. The plan is for these investments to be implemented by reinvesting a portion of the amount obtained by selling the shares of Toyota Industries in the transactions which have been held by Toyota Fudosan, Mr. Akio Toyoda, and Toyota Motor since Toyota Industries was listed.
Furthermore, Toyota Motor, AISIN, DENSO, and Toyota Tsusho will sell their shares in Toyota Industries in the transactions, and simultaneously, will acquire their shares held by Toyota Industries through the tender offers for their treasury shares. This, the companies say, will dissolve the cross-shareholding between Toyota Industries and those four companies - except Toyota Motor will continue to invest in Toyota Industries in the form of preferred shares mentioned above.
To meet the increasingly diverse and sophisticated needs of logistics sites, Toyota Industries is focusing on the development of autonomous technologies for logistics equipment such as forklifts, logistics management software, and environmentally friendly powertrains, and it will work on utilisation of data related to the movement of goods.
Through this privatisation, Toyota Industries intends to deepen collaboration within Toyota Group, dynamically and swiftly advance these activities, and lead the way in the mobility sector with respect to "goods" for transformation of Toyota Group.
Toyoda's buyout plan coincides with Toyota's efforts to restore governance trust following regulatory scandals at subsidiaries, including Toyota Industries.
"Toyota to take key supplier private" was originally created and published by Just Auto, a GlobalData owned brand.
