Toyota Prepping For $4.7 Billion Stake Sale In Supplier Denso To Shift To Electric Vehicles
Portfolio Pulse from Benzinga Neuro
Toyota Motor Corp (NYSE:TM) and its affiliates are planning to sell approximately 10% of their shares in Denso, an automotive components manufacturer, for an estimated $4.7 billion. This move is part of Toyota's strategy to divest stakes in group companies to fund an increase in electric vehicle (EV) production. Toyota will remain the largest shareholder in Denso post-sale, and Denso may buy back some of its shares to mitigate the impact on its stock price.
November 28, 2023 | 1:33 pm
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Toyota is selling a portion of its stake in Denso for $4.7 billion to fund its EV production expansion. Toyota will still be the largest shareholder in Denso after the sale.
The sale of Denso shares by Toyota is a strategic move to reallocate resources towards EV production, which is a growing market. While the sale is significant, Toyota's continued majority stake in Denso suggests a maintained strategic interest in the supplier. The impact on Toyota's stock price is likely to be neutral in the short term as the market may have anticipated such strategic shifts towards EVs, and the sale does not indicate a lack of confidence in Denso but rather a reallocation of assets.
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