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Japan Times
04-06-2025
- Automotive
- Japan Times
For Toyota, more Akio Toyoda would be a good thing
Akio Toyoda, the scion of Toyota Motor's founding family and former chief executive officer, generally seems to prefer being behind the wheel of a car than being in the spotlight. But with the $33 billion buyout of Toyota Industries announced Tuesday, along with his personal investment, he might be making a corporate comeback. That would be a good thing, regardless of what the critics say. Opinion is divided on whether the takeover represents a step forward or back for corporate governance in Japan. Investors and officials have long sought the dissolution of parent-child listings like Toyota Industries, in which the larger automaker holds a controlling stake; the lack of independent oversight has been blamed for past safety lapses. But many suspect the take-private is actually about Akio Toyoda (for the sake of simplicity, hereafter referred to as Akio) reasserting control over the company he ran until 2023. He is staking just ¥1 billion ($7 million) of his own cash in the deal, but it's a complex structure that also involves the unlisted real estate firm Toyota Fudosan — which Akio chairs — taking over Industries. That firm was first set up by Sakichi Toyoda, his great-grandfather, to make automatic looms in the 1920s. From this company, Toyota Motor, a division founded by Sakichi's son Kiichiro, was spun off in 1937. It's unclear how much control Akio, who has been reported to be behind the bid, would exert after the deal is complete. But not everyone would be happy with a return. "Akio Toyoda ran Toyota for 14 years. Some fear he still does,' said the New York Times last year. Fully two-thirds of foreign institutional investors opposed his re-election as a director at 2024's annual general meeting. Proxy advisers Glass Lewis and Institutional Shareholder Services both urged the AGM to vote against him, citing governance issues and a supposed scandal around cutting corners during safety tests. His overall support rate among shareholders of 72% was the lowest of any director in Toyota's history. "I'm being told 'no' by foreign investors,' he said at the time. "At this pace, I can't be a director next year.' This opposition is nonsensical. Akio turned Toyota into the biggest automaker in the world during a period of intense industry change. Under his leadership, it recorded the single best-ever quarter of profit by a Japanese company, and became the country's largest-ever business by market capitalization, surpassing a 37-year bubble-era record. The returns for shareholders over his time in office dwarf those of his peers at other automakers, many of whom are paid far more. As I wrote last year, the safety "scandal' for which investors were willing to vote him out was a nothingburger that had zilch in common with the management-led fraud of Volkswagen's Dieselgate. The issue was little more than corners being cut and once retested, all vehicles passed with flying colors. This was a safety scandal that not only didn't involve a single fatality, but didn't even involve a single accident. Contrast with, say, U.S. authorities' probe of Tesla's automated driving feature. Another concern is informal family control of public companies, common in Japan while raising eyebrows elsewhere. But investors should relax: From Capcom (with the stock price having risen by 14 times since Haruhiro Tsujimoto, son of founder Kenzo, took over as president in 2007) to Sanrio (up 12 times since 2020, when Tomokuni Tsuji took over from his grandfather), there's plenty of evidence to show it can work. In past years, investors were also unhappy with the pace of Toyota's plans to electrify. Akio became a convenient lightning rod for all kinds of opposition, with the likes of Greenpeace piling on to dismiss its efforts to decarbonize. But this COVID-19-era obsession with full electrification at all costs seems now as quaint as the same period's nonfungible tokens boom. Today, competitors have been forced to retreat from their grandiose plans to abandon internal combustion engines, while Toyota has gone from strength to strength due to its hybrids and unwillingness to bow to the tyranny of the majority. Indeed, through his promotion of hybrid technologies, Akio may well have done more for emissions than any single executive on earth, with Toyota estimating its vehicles have reduced global emissions of carbon dioxide by nearly 200 million tons. In other realms, it's understood that executives shouldn't let perfect be the enemy of good. Yet Akio rarely gets afforded this leeway. There are few hagiographies from the business press or gushing profiles like his erstwhile peer at Japanese automaker Nissan Motor, Carlos Ghosn, enjoyed both before and after his trouble with the law. Akio doesn't feature in glowing portraits in New York magazines, nor is he the type of executive profiled in business books, a privilege these days often reserved for crypto frauds. He doesn't feature on lists of world's greatest executives, and, indeed, he is perhaps still best known for his appearance before the U.S. Congress in 2010 during the unintended acceleration scandal — another incident that may have been grossly exaggerated. Akio may choose to continue in the background or even retreat further once this deal is done. But if anything, investors should be handing him the keys. Gearoid Reidy is a Bloomberg Opinion columnist covering Japan and the Koreas.
03-06-2025
- Automotive
Japan's Toyota Industries to Go Private
News from Japan Jun 3, 2025 20:44 (JST) Nagoya, June 3 (Jiji Press)--Japan's Toyota Motor Corp. and group companies said Tuesday that they will take machinery maker Toyota Industries Corp. private through a tender offer. The move is aimed at reorganizing complex capital relationships among group companies. The total acquisition cost is estimated at 4.7 trillion yen. Toyota Industries has approved the tender offer, expected to start in early December. Among the participants are Toyota Motor Chairman Akio Toyoda and Toyota affiliates including auto parts makers Aisin Corp. and Denso Corp. and trading house Toyota Tsusho Corp. Toyota Industries was established in 1926 by Sakichi Toyoda, the founder of the Toyota group. Toyota Motor was created from a division of Toyota Industries. As a result, Toyota Industries has long-standing cross-shareholding relationships with many group companies. [Copyright The Jiji Press, Ltd.] Jiji Press
Time of India
03-06-2025
- Automotive
- Time of India
Toyota to take private key unit in $26 billion deal
Toyota Motor will take private a key supplier of its group, it said on Tuesday, in a $26 billion deal , marking a landmark repositioning of Japan's most important corporation. Under the terms of the deal, unlisted real estate company Toyota Fudosan will launch a tender offer for shares of Toyota Industries for 3.7 trillion yen ($26 billion), the companies said. Separately, Toyota said it plans to buy back its own shares from Toyota Industries. Japanese companies have come under growing scrutiny from the market regulator and investors in recent years about their cross-shareholdings in affiliates and business partners, sparking a rise in both management buyouts and acquisitions. Many of the deals have been driven by expectations that a corporate governance overhaul will bring better shareholder returns. Toyota had said in April it was considering participating in a potential buyout of Toyota Industries - a move that sources have said would help improve the group's corporate governance. Toyota owned about 24% of Toyota Industries as of September last year, while Toyota Industries held around 9% of the world's biggest automaker and more than 5% of Denso, another major Toyota supplier and Toyota group company. Toyota Industries, formerly Toyoda Automatic Loom Works, was founded in 1926 by Sakichi Toyoda to make automatic looms. An automotive division within the company was set up and later spun off as Toyota Motor. In addition to forklifts, Toyota Industries manufactures the RAV4 sport utility vehicle for Toyota and also produces car parts such as engines, air-conditioning compressors, batteries and converters.
New Straits Times
03-06-2025
- Automotive
- New Straits Times
Toyota to take private key unit in US$26 billion deal
TOKYO: Toyota Motor will take private a key supplier of its group, it said on Tuesday, in a US$26 billion deal, marking a landmark repositioning of Japan's most important corporation. Under the terms of the deal, unlisted real estate company Toyota Fudosan will launch a tender offer for shares of Toyota Industries for 3.70 trillion yen (US$26 billion), the companies said. Separately, Toyota said it plans to buy back its own shares from Toyota Industries. Japanese companies have come under growing scrutiny from the market regulator and investors in recent years about their cross-shareholdings in affiliates and business partners, sparking a rise in both management buyouts and acquisitions. Many of the deals have been driven by expectations that a corporate governance overhaul will bring better shareholder returns. Toyota had said in April it was considering participating in a potential buyout of Toyota Industries – a move that sources have said would help improve the group's corporate governance. Toyota owned about 24 per cent of Toyota Industries as of September last year, while Toyota Industries held around nine per cent of the world's biggest automaker and more than five per cent of Denso, another major Toyota supplier and Toyota group company. Toyota Industries, formerly Toyoda Automatic Loom Works, was founded in 1926 by Sakichi Toyoda to make automatic looms. An automotive division within the company was set up and later spun off as Toyota Motor. In addition to forklifts, Toyota Industries manufactures the RAV4 sport utility vehicle for Toyota and also produces car parts such as engines, air-conditioning compressors, batteries and converters.
Time of India
03-06-2025
- Automotive
- Time of India
Toyota to take private key unit in $26 billion deal
Toyota Motor will take private a key supplier of its group, it said on Tuesday, in a $26 billion deal, marking a landmark repositioning of Japan's most important corporation. Under the terms of the deal, unlisted real estate company Toyota Fudosan will launch a tender offer for shares of Toyota Industries for 3.7 trillion yen ($26 billion), the companies said. Separately, Toyota said it plans to buy back its own shares from Toyota Industries. Japanese companies have come under growing scrutiny from the market regulator and investors in recent years about their cross-shareholdings in affiliates and business partners, sparking a rise in both management buyouts and acquisitions. Many of the deals have been driven by expectations that a corporate governance overhaul will bring better shareholder returns. Live Events Toyota had said in April it was considering participating in a potential buyout of Toyota Industries - a move that sources have said would help improve the group's corporate governance. Toyota owned about 24% of Toyota Industries as of September last year, while Toyota Industries held around 9% of the world's biggest automaker and more than 5% of Denso, another major Toyota supplier and Toyota group company. Toyota Industries, formerly Toyoda Automatic Loom Works, was founded in 1926 by Sakichi Toyoda to make automatic looms. An automotive division within the company was set up and later spun off as Toyota Motor. In addition to forklifts, Toyota Industries manufactures the RAV4 sport utility vehicle for Toyota and also produces car parts such as engines, air-conditioning compressors, batteries and converters. Economic Times WhatsApp channel )
