The Toyota Group has increased its buyout offer for Toyota Industries Corp by 15%, lifting the implied valuation to JPY6.1tn ($39bn), after pressure from activist hedge fund Elliott Investment Management, according to a report by Bloomberg.
Toyota Motor Corp said it will now offer JPY18,800 per share for the outstanding shares it does not already own, up from the original JPY16,300 bid announced in June last year. The tender offer is set to open on 16 January and will run until 12 February.
The revised bid marks a rare win for shareholder activism in Japan, where Elliott had publicly criticised the initial proposal as undervaluing the company. Elliott disclosed a 5% stake in Toyota Industries in November and subsequently sought to rally other investors to oppose the original terms.
Toyota Industries is set to be taken private through a special-purpose vehicle controlled primarily by Toyota Fudosan, an unlisted real estate company chaired by Toyota Motor chairman Akio Toyoda. Discussions around improving the offer had been ongoing since December, according to statements released on Wednesday.
The takeover proposal has faced scrutiny from both domestic and international investors, with critics arguing that the original bid lacked transparency and failed to adequately protect minority shareholders. Toyota Industries’ shares have traded above the initial offer price since August, signalling market expectations of a higher bid.
While the increased offer represents a concession to activist demands, analysts said questions may remain over valuation. The deal had already been delayed after antitrust approvals in several jurisdictions slowed the launch of the tender process.
