Elliott digs in as Toyota Industries standoff intensifies

Elliott Funding Administration maintained its opposition to Toyota Group’s buyout proposal for Toyota Industries, after the automotive conglomerate mentioned it has no intention of elevating its provide worth. The US activist fund, which holds a 6.7% stake within the automotive provider towards Toyota Group’s 48%, mentioned the revised tender provide of US$121 per share “very considerably undervalues” the corporate.

Toyota Asset Preparatory, an entity fashioned by Toyota Group solely for the takeover of Toyota Industries, mentioned on 1 February that its US$34bn provide represents the “very best worth reflecting the intrinsic worth” of the corporate. Elliott argues the shares are price at the very least US$167 every—38% greater than what the group has described as its ceiling—and will attain US$258 by 2028 if it stays publicly listed. The fund issued a 52-page presentation laying out its case and mentioned it doesn’t intend to tender its shares.

Toyota wants to regulate two-thirds of all shares to brute pressure a full acquisition; the present sum of 48% displays the inclusion of cross-shareholdings and allied firms. Shareholders have till twelfth February to tender their shares, though this deadline might be prolonged. Toyota Industries at present trades at round US$126 per share, barely above the provide worth.

Japanese equities analyst Travis Lundy estimated to Bloomberg that Elliott might solely want help from an extra 7% of voting shares to efficiently block the deal, supplied that passive buyers accounting for round 19% of shares refuse to tender beneath market worth. Ought to Elliott prevail, it could mark one of many greatest victories for shareholder activism in Japan and probably dilute the founding household’s management over its sprawling enterprise empire.

The contentious buyout has drawn widespread criticism from company governance consultants for its low provide and opaque valuation technique, regardless of some restricted reward for unwinding cross-shareholdings that may allow abuses of minority shareholder rights. Asset Worth Buyers, which holds about 0.1% of Toyota Industries, mentioned {that a} “minimal honest valuation” could be US$161 per share.

The deal, if profitable, would switch management over to unlisted property agency Toyota Fudosan, chaired by Akio Toyoda, who additionally leads the board for Toyota Motor. The founding household has drawn persistent scrutiny for the extent of management it exerts over the enterprise empire; Toyoda himself has drawn ire for his vibrant help of US President Donald Trump amid the US-Japan commerce dispute.

On 2 February, Toyota Industries reported working earnings of US$312m for Q3 2025, and maintained full-year steerage of US$643m—appreciably wanting analyst estimates of US$1.1bn. This may very well be the corporate’s final fiscal 12 months as a publicly listed entity if the tender succeeds. Stories have additionally prompt that Elliott individually is weighing a counter-bid for Toyota Industries.