In this client update, GMO’s Usonian Japan Equity team assesses the implications of a potential take-private transaction of Toyota Industries Corporation (TIC) and calls for improved governance standards in Japan's capital markets.
Key insights:
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TIC’s persistent undervaluation (trading at 0.66x price-to-book) is linked to inefficient governance and Toyota Group cross-shareholdings.
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Recent reports of a potential buyout by Toyota Motor Co. sparked a market rally, confirming governance concerns as a key valuation drag.
Read the full letter to explore why this moment could set a vital precedent for Japanese corporate governance reform.
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