Activist investor Elliott Investment Management has publicly opposed Toyota Fudosan’s revised tender offer for Toyota Industries Corporation, arguing that the bid significantly undervalues the company and undermines Japan’s corporate governance reforms.
In an open letter to shareholders, Elliott, the largest independent minority shareholder in Toyota Industries, said it does not intend to tender its shares into the JPY18,800-per-share offer and urged other investors to reject the proposal. The firm estimates Toyota Industries’ intrinsic net asset value at more than JPY26,000 per share as of mid-January, almost 40% above the revised offer price.
Elliott said the gap between the offer and fair value has widened since the original tender was announced in June 2025, pointing to a sharp rise in the value of Toyota Industries’ listed shareholdings and stronger valuations across comparable industrial peers. The investor also argued that the revised bid fails to reflect recent market gains and effectively allows Toyota Fudosan to acquire core operating assets at a deeply discounted valuation.
The hedge fund criticised the transaction’s governance structure, claiming the process lacks proper minority shareholder protections and involves conflicts of interest among advisers and Toyota Group affiliates. Elliott warned that allowing the deal to proceed on current terms would represent a setback for Japan’s ongoing efforts to strengthen corporate governance and fair M&A practices.
Instead, Elliott said Toyota Industries could unlock substantially greater value as a standalone company. It outlined a plan focused on unwinding cross-shareholdings, improving margins in its materials handling and automation businesses, tightening capital allocation and implementing governance reforms. Under this approach, Elliott believes the company could reach a valuation of more than ¥40,000 per share by 2028.
Toyota Industries shares have continued to trade above the revised offer price, which Elliott said reflects ongoing investor dissatisfaction with the proposed transaction.
