Shareholders of Toyota Industries have expressed their dissatisfaction with a proposed $33 billion buyout offer from Toyota Motor, citing concerns that the bid may not accurately reflect the company’s true value and could unfairly benefit the Toyoda family.
The proposal, which has been criticized for undervaluing Toyota Industries, has garnered both international and domestic disapproval, with Zennor Asset Management and Oasis Management among those voicing their opposition, as reported by Reuters.
Toyota Motor’s plan to privatize Toyota Industries through a complex deal includes offering Y16,300 per share, a price that shareholders believe falls short of the supplier’s actual worth and could potentially increase the influence of the founding Toyoda family within the group.
During a meeting discussing the acquisition, one shareholder remarked, “I don’t think I am the only one who feels the price is too low,” while another raised concerns about the potential “domination” of Toyota Industries by the automaker.
The session, lasting nearly two hours, saw executives fielding a record number of questions from concerned shareholders. Toyota Industries’ chairman, Akio Toyoda, may face similar scrutiny at Toyota Motor’s upcoming annual general meeting.
Toyota has defended the acquisition, stating that it would lead to deeper collaboration within the group as it transitions into a “mobility company.” The transaction involves establishing a new holding entity, with investments from unlisted Toyota Fudosan and Akio Toyoda, the founder’s grandson.
Toyota Motor is set to contribute Y700 billion for non-voting preferred shares, with Oasis, holding stakes in both companies, publicly advocating for a higher offer price. Other critics, including Zennor, have highlighted the undervaluation of Toyota Industries’ significant real estate assets, which are valued at 1.5 trillion yen on the balance sheet.
With Toyota Group companies owning at least 39% of Toyota Industries, it is expected that the deal will proceed, with shares closing at the offer price of Y16,300.
The original article, “Toyota Industries’ $33bn deal faces shareholder criticism,” was first published by Just Auto, a brand owned by GlobalData.
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