Toyota Fudosan, the real estate arm of the Toyota Group, announced plans on Tuesday to launch a tender offer to take Toyota Industries Corp. private.
The proposed acquisition marks one of Japan’s most significant buyout efforts and signals continued movement among Japanese companies toward consolidating operations and simplifying governance structures.
The offer will be made through a special-purpose entity that Toyota Fudosan intends to establish. The purchase price is set at ¥16,300 per share, or approximately $114.22. Following the deal, Toyota Fudosan is expected to control a 99.44% stake in the new entity, while Toyota Motor Chairman Akio Toyoda will hold the remaining stake. Toyoda also chairs Toyota Fudosan.
Toyota Industries, a core part of the Toyota Group ecosystem, manufactures a range of products including forklifts, automobile components, engines, and textile machinery. Its shares have surged over 40% since late April, when reports of potential privatization emerged. On Tuesday, shares closed 0.8% higher at ¥18,400.
Founded in 1926, Toyota Industries was the origin company from which Toyota Motor was spun off in 1937. Today, Toyota Motor owns approximately 24.2% of Toyota Industries, while the latter maintains a 9.1% stake in the auto giant—part of a broader cross-shareholding structure common among Japanese conglomerates.
The deal under consideration is part of a growing trend in Japan, where companies are choosing to delist or consolidate as shareholder activism increases and regulators push for stronger corporate governance and better returns. Buyout activity has accelerated, often with support from private equity firms, although some attempts have faced challenges due to the substantial capital required.
The move would also help address criticism of Japan’s long-standing “parent-child” company structures—where publicly listed subsidiaries operate under dominant parent firms—by bringing Toyota Industries entirely under private ownership. This structure has been increasingly discouraged by Japanese authorities in efforts to modernize the country’s corporate landscape.
Toyota Industries previously stated it had received a variety of proposals related to its future, including a privatization offer. A special board committee has been formed to evaluate the offer under Japan’s governance guidelines. While a final decision has not yet been made public, the company said discussions were ongoing and that any resolution would be disclosed promptly.
According to sources familiar with the matter, the total value of the deal could be around ¥6 trillion (approximately $42 billion), which would place it among the largest private buyouts globally.
This development also comes as Toyota works to restore trust in its governance systems, following regulatory scrutiny at several subsidiaries, including Toyota Industries. Meanwhile, Toyota Motor is preparing for its own annual shareholder meeting on June 12, two days after Toyota Industries holds its general meeting.
French investment fund Longchamp, represented by Dalton Investments, has submitted proposals to increase board independence at Toyota Industries by appointing more outside directors. The company has opposed these proposals, reinforcing the significance of the upcoming shareholder meeting.
Bloomberg and the Wall Street Journal contributed to this report.
