Toyota Industries Buyout Faces Resistance as Elliott Rejects Higher Offer

Toyota Motor’s revised buyout offer for Toyota Industries, raised by about 15%, has failed to win over activist investor Elliott Investment Management, keeping uncertainty around one of Japan’s largest corporate transactions firmly in place. The improved bid, announced this week, values Toyota Industries at approximately 5.6 trillion yen ($35 billion), but Elliott argues the offer still “very substantially” undervalues the forklift and industrial equipment maker.

Toyota Motor, together with Chairman Akio Toyoda and group real estate arm Toyota Fudosan, lifted the offer price to 18,800 yen per share from an initial 16,300 yen. Despite the increase, Elliott, which disclosed its stake in Toyota Industries in November and raised its holding to 5% last month, said it will not tender its shares and will encourage other shareholders to do the same. According to Elliott, its analysis suggests Toyota Industries’ businesses and financial assets are worth more than 25,000 yen per share, well above the current bid.

Market reaction has reflected that skepticism. Toyota Industries shares continued to rise, trading around 19,400 yen on Friday, roughly 3% above the revised offer price and up about 8% over the past two days. This price action suggests investors may be betting on a further increase in the bid or a more favorable outcome for minority shareholders.

Toyota Motor said it is aware of Elliott’s comments and will closely monitor developments. Toyota Fudosan and Toyota Industries defended the revised offer, stating it reflects intrinsic value and follows thorough discussions between the companies, with a commitment to engage in sincere dialogue with investors.

The proposed buyout, which would strengthen the Toyoda founding family’s control over the Toyota group, has drawn criticism from global investors who previously questioned the transparency and logic of the valuation. Analysts note that rising share prices across Toyota group companies have boosted the value of Toyota Industries’ cross-shareholdings, complicating the valuation further. With the tender offer running until February 12, many investors are expected to wait until late in the process to see whether Toyota sweetens the deal again, keeping the Toyota Industries buyout firmly in the spotlight.