Toyota Motors' effort to take Toyota Industries private facing regulatory hurdles - report

[Toyota motor, dealership facade]
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Toyota Motor’s (NYSE:TM [https://seekingalpha.com/symbol/TM]) effort to take its Toyota Industries subsidiary private is facing antitrust headwinds, pushing the planned launch out until at least February.

Under the terms of the deal [https://seekingalpha.com/news/4454722-toyota-industries-receives-take-private-offer-from-group-companies], Toyota Fudosan, the Toyoda family’s investment vehicle, would make a tender offer of ¥16,300 for each share of Toyota Industries, an 11% discount to its share price as of the day of the June announcement. Toyota Motors chairman Aiko Toyoda will invest ¥1B into the holding company that will be established to privatize Toyota Industries while Japan’s top banks will jointly contribute ¥2.8 trillion to the acquisition company to support the buyout.

Because of Toyota’s (NYSE:TM [https://seekingalpha.com/symbol/TM]) global presence, the deal needs the regulatory approval in Japan, the U.S., Mexico, the EU, and Brazil, as well as 12 other countries. So far, only Canada, Australia, Israel, and South Africa have approved the transaction.

Besides the necessary regulatory hurdles, the deal is also facing opposition from shareholders who argue that the offer undervalues Toyota Industries’ real estate assets.

"While it may not satisfy all shareholders, we're confident in both the fairness of the price and the strategic purpose of the transaction," a Toyota spokesperson said to Reuters.

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