The stake sale occurs as the Japanese giant accelerates its electric vehicle production.
Toyota Motor and its affiliates, Toyota Industries and Aisin are set to divest approximately 10% of their shares in Denso, a key automotive components manufacturer, by the end of this year. This transaction is anticipated to be valued at around US$ 4.7 billion, as reported by various news agencies. This strategic move aligns with Toyota’s ambition to enhance its production of fully electric vehicles, a venture that demands significant capital investment.
The proposed sale, involving shares amounting to roughly 700 billion yen (US$ 4.7 billion) at current market values, is part of Toyota’s broader strategy to focus on electric vehicle technology. Toyota Motor will sell slightly less than half of the approximately 10% stake, with the balance shared between Toyota Industries and Aisin. Denso, recognized as the world’s second-largest automotive component manufacturer and a crucial supplier for Toyota, is also planning to repurchase some of its shares from the open market. This move is intended to mitigate any potential impact on its stock price, as per sources who requested anonymity due to the confidential nature of the discussions.
Denso has acknowledged the possibility of a share sale and buyback alongside other capital strategies but clarified that no final decisions have been made. Meanwhile, a Toyota spokesperson stated that the company could not comment on the matter, and an Aisin representative also declined to comment.
Despite this sale, Toyota Motor, which held a 24.2% stake in Denso as of September’s end, is expected to retain its position as the principal shareholder. The shares are likely to be purchased predominantly by domestic investors, though the exact pricing remains undetermined, as per sources.
This initiative follows Toyota’s announcement in July to sell shares worth about 250 billion yen to telecommunications firm KDDI Corp. This was part of Toyota’s comprehensive plan to enhance the efficiency and cost-effectiveness of its battery-electric vehicles.
