A major activist investor is weighing a potential tender offer for Toyota Industries, according to a Japanese business daily that reported the development on Wednesday. The move, if advanced, could add fresh complication to the Toyota groups effort to take the forklift and machinery maker private.
The activist has been openly critical of the auto group's revised proposal of 18,800 yen per share, calling the price too low and explicitly urging Toyota Industries shareholders not to tender into that offer. The take-private plan itself was first unveiled last June with an initial proposal priced at 16,300 yen per share and has since drawn criticism from several investors.
Those critics have focused on what they say amounts to an opaque approach to valuing the company and a process that did not sufficiently safeguard the interests of minority shareholders. The scrutiny on the transaction increased following disclosure by the activist, which revealed a stake in the company in November.
As of the latest filing last week, the activist's stake in Toyota Industries stood at 6.65 percent. Citing an unnamed source, the business daily reported that the investor's holding has grown since that filing and that it is exploring a rival bid designed to prevent shareholders from tendering their shares into the revised offer.
The report included the same currency conversion used in filings and commentary on the situation: $1 = 152.5800 yen.
Observers following the transaction have noted a sequence of events that began with a lower initial proposal and moved to a higher revised offer, while attracting pushback over valuation methods and process fairness. The activist's public stance against the revised price and its potential move toward a competing tender offer represent the latest developments in the contested path toward privatization.
Summary
- An activist investor is reportedly considering a tender offer for Toyota Industries, potentially complicating the Toyota group's take-private plan.
- The activist has criticized the revised 18,800 yen per share offer as too low and urged shareholders not to tender.
- The investor disclosed a 6.65% stake in November; reports indicate that stake may have increased and that a rival bid is being explored.
Key points
- The contested transaction affects the automotive and industrial machinery sectors, particularly corporate governance and M&A activity among Japan-listed manufacturers.
- Shareholder protections and valuation methodology are central issues cited by investors opposing the original process.
- The activist's disclosed 6.65% stake, and reports of a further increase, raise the prospect of direct shareholder engagement through a tender offer.
Risks and uncertainties
- It remains uncertain whether the activist will formally launch a rival tender offer; reports describe only that the investor is exploring such an action.
- The outcome for existing shareholders is unclear, particularly whether a competing bid would deter tendering into the revised 18,800 yen proposal.
- Questions persist about valuation transparency and whether minority shareholder interests have been adequately considered in the take-private process.