Toyota Motor Eyes Massive ¥6 Trillion Acquisition of Toyota Industries

Toyota Motor Eyes Massive

 ¥6 Trillion  Acquisition of Toyota Industries

 

Japan’s stock market was set abuzz following reports that Toyota Motor Corporation is considering acquiring Toyota Industries Corporation in a landmark deal worth over ¥6 trillion, sparking a frenzy among investors and raising critical questions about future corporate governance within the Toyota Group.

On April 28, 2025, Bloomberg reported that shares of Toyota Industries surged as much as 23% in a single day — the highest on record — following speculation that Akio Toyoda, Chairman of Toyota Motor, is preparing to buy out the entire Toyota Industries business. Toyota Motor shares also rallied, gaining 5.2% during the session.

Behind the Massive Deal

Toyota Industries, the original parent company of Toyota Motor, produces industrial looms and auto parts for the Toyota Group. The acquisition proposal comes amid growing pressure from Japanese investors for stronger governance practices and improved shareholder returns, particularly targeting complex cross-shareholding structures within conglomerates.

Mixed Reactions from Analysts

Norikazu Shimizu, an analyst at IwaiCosmo Securities, cautioned that Toyoda’s attempt to consolidate control over Toyota Industries could be viewed as a step backward for corporate governance, particularly as Toyota Industries had recently begun unwinding cross-shareholdings with group companies.

Meanwhile, Kazunori Maki from SMBC Nikko Securities noted that if the acquisition materializes, the founding Toyoda family would significantly strengthen its influence over the broader Toyota Group — a move that might hinder efforts to enhance governance standards and could weigh on the return on equity (ROE) for both Toyota Motor and Toyota Industries.

Nevertheless, some analysts maintain a more optimistic view. Tatsuo Yoshida from Bloomberg Intelligence suggested that increased autonomy under Toyoda’s leadership could ultimately benefit Toyota Motor shareholders over the long term, emphasizing that Toyota Industries’ industrial vehicle division remains a strong source of profitability.

Similarly, James Hong from Macquarie Group stated that the potential acquisition is further evidence that Toyota is actively working to streamline governance — a positive sign for the group's overall structure.

No Final Decision Yet, but Investor Optimism Soars

Toyota Motor issued a statement confirming that it is exploring various options, including a partial investment in Toyota Industries, but emphasized that no final decision has been made.

Still, the market’s euphoric response suggests investors are betting on a premium buyout price should the deal proceed. If completed, it would rank among the largest mergers and acquisitions in Japan’s history and could reshape the power dynamics within the Toyota Group for years to come.