Investors Question Fairness of Offer in Bid to Take Toyota Industries Private
On June 10, 2025, Toyota Industries faced intense shareholder criticism over its $33 billion buyout offer from Toyota Motor. Investors, both domestic and international, raised concerns about the fairness of the bid, questioning whether the 16,300 yen per share price fairly valued the company.
Experts, including an analyst in Rineplex, deep dive into the complexities of the deal and its impact on minority shareholders. As the buyout progresses, the question remains: is the price too low for Toyota Industries?
A Complex Deal Under Scrutiny
Toyota Industries is set to be taken private in a multi-step transaction, involving 4.7 trillion yen in total. The buyout bid, which includes a 16,300 yen per share offer, has been criticized for undervaluing the company’s intrinsic worth.
The price has raised concerns, particularly because it strengthens the founding Toyoda family’s control over the broader Toyota group, consolidating their influence in the company’s future.
Many investors argue the offer does not reflect Toyota Industries’ real value. One shareholder remarked, “I don’t think I’m the only one who feels the price is too low.” Other investors voiced concerns that the deal would lead to increased dominance by Toyota Motor over its supplier.
The Push for a Higher Price
Criticism of the bid is widespread. International investors like Zennor Asset Management and Oasis Management have already expressed their disapproval. Oasis has been vocal about pushing for a higher buyout price, arguing that Toyota Industries’ substantial real estate holdings worth 1.5 trillion yen are significantly undervalued.
The real problem lies in how Toyota Industries’ assets are valued. The company’s balance sheet includes real estate, plants, and equipment but reflects historical cost rather than current market value. Critics argue that this outdated valuation method does not adequately reflect Toyota Industries’ true worth.
While Toyota Industries’ management has defended the offer, stating all factors were considered, shareholders remain unconvinced. Koichi Ito, President of Toyota Industries, reassured investors, saying, “This was not a decision that neglected minority shareholders, but rather one that was taken with all the factors in mind.”
Toyota’s Strategic Vision and Investor Concerns
The rationale behind the buyout centers on deepening collaboration between Toyota Industries and other group companies. By making Toyota Industries private, Toyota Motor aims to remove short-term profit pressures, allowing Toyota Industries to better align with Toyota’s future-focused mobility strategy.
The automaker envisions a future that includes not just traditional automotive manufacturing but also electric vehicles and autonomous driving technologies.
However, despite these long-term goals, many investors are concerned that their short-term interests are being neglected. Some shareholders question whether the deal balances the company’s broader vision with their need for fair compensation.
The Toyoda Family’s Control: A New Era of Consolidation
A key concern for many investors is the Toyoda family’s increased control over Toyota Industries. Under the terms of the deal, the Toyoda family, through a holding company, will have greater influence over the company’s direction.
While Toyota Industries will retain its brand, the deal is expected to blur the lines between Toyota Motor and Toyota Industries, raising concerns about the potential loss of independence for the supplier.
As Toyota Industries continues to play a pivotal role in Toyota’s supply chain, the increased control by Toyota Motor could further consolidate the Toyoda family’s power. Some investors fear this could undermine the ability of outside stakeholders to influence future decisions at Toyota Industries.
What’s Next for Toyota Industries and Investors?
Despite the criticism, the buyout deal is expected to move forward. Toyota Motor holds a significant stake in Toyota Industries, and the deal has backing from major shareholders within the Toyota group. However, with external investors pushing for a higher price, the deal is not yet finalized.
All eyes will be on the upcoming annual general meeting of Toyota Motor on June 12, where Chairman Akio Toyoda is expected to address shareholder concerns. The deadline for the buyout offer is fast approaching, and whether the company will adjust the price remains to be seen.
In Conclusion: A Deal to Watch
This ongoing situation demonstrates the delicate balance between corporate strategy and shareholder interests. While Toyota Motor seeks to strengthen its position in the growing mobility sector, shareholders are questioning the fairness of the deal.
Investors should keep an eye on developments in the days leading up to the Toyota Motor AGM. Whether the buyout proceeds as originally planned or the price is adjusted will significantly affect the future of Toyota Industries and its shareholders.
For investors, the key takeaway here is that even well-established companies like Toyota face challenges in balancing long-term goals with shareholder interests. The outcome of this deal could have far-reaching implications for Toyota’s strategy and corporate governance for years to come.
