TOKYO (Reuters) – Toyota Motor supplier Denso plans to eventually sell all of its cross-shareholdings, its president said on Friday, as the company looks to fund acquisitions and other investments.
WHY IT’S IMPORTANT
Investors have long pressured Japanese companies to sell-off cross-shareholdings and put their capital to better use. Firms have been gradually selling down their stakes, thanks in part to a governance push by the Tokyo Stock Exchange and the government.
Toyota and some other of its group companies last year sold around 8% of Denso, a move that was seen as a critical first step by the sprawling Toyota Group and heightening expectation of more sales to come.
CONTEXT
* Denso President Shinnosuke Hayashi told a briefing the supplier of auto components will continue selling its cross-shareholdings, with the intent to sell all of them, after holding talks with the companies involved.
* Denso, which doesn’t disclose the size of its cross-shareholdings, in March announced plans to sell all of its 9.1% stake in Toyota Industries.
* It has also cut holdings in JTEKT, another group company.
Don't miss out on any breaking news or insightful opinions!
Subscribe to our free newsletter and stay updated on the go!
By submitting this form, you are consenting to receive marketing emails from: Global Banking & Finance Review. You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email.
KEY QUOTES
“Basically, we are not going to hold a portion of the shares, but rather we are moving towards selling all of our shares,” Executive Vice President Yasushi Matsui told the briefing.
* Hayashi said the elimination of cross-shareholdings was important for increasing the competitiveness of the entire industry.
BY THE NUMBERS
* Denso reported a 11% decline in full-year operating profit on Friday.
* It forecast an 88% profit increase for the year to March, for 714 billion yen ($4.6 billion).
($1 = 156.6300 yen)
Uma Rajagopal has been managing the posting of content for multiple platforms since 2021, including Global Banking & Finance Review, Asset Digest, Biz Dispatch, Blockchain Tribune, Business Express, Brands Journal, Companies Digest, Economy Standard, Entrepreneur Tribune, Finance Digest, Fintech Herald, Global Islamic Finance Magazine, International Releases, Online World News, Luxury Adviser, Palmbay Herald, Startup Observer, Technology Dispatch, Trading Herald, and Wealth Tribune. Her role ensures that content is published accurately and efficiently across these diverse publications.
