According to Reuters, Toyota Fudosan Co, a real estate developer headed by Toyota Motor Corp Chairman Akio Toyoda, will acquire shares in Toyota Industries Corp, after which the latter will become a private company.

Details of the deal and its structure

Toyota Fudosan will buy Toyota Industries shares from Toyota Motor Corp., Aisin Corp., Denso Corp., and Toyota Tsusho Corp. for 16,300 yen per share, 11% below their market value at the close of trading on Monday. The total amount of the deal will be 4.7 trillion yen ($32.9 billion).

To implement it, a new holding company will be created. Toyota Fudosan will invest 180 billion yen and receive a 99.44% stake, while Akio Toyoda will invest 1 billion yen and become the owner of the rest. Toyota Motor will additionally invest 700 billion yen. The companies selling the shares will, in turn, buy back their own securities from Toyota Industries.

History and market performance

Toyota Industries, founded in 1890 by Akio Toyoda’s great-grandfather, is a supplier to Toyota Motor, which was founded by his grandfather in 1937. Toyota Motor, the world’s largest automaker with annual production of over 11 million vehicles, currently owns 24.2% of Toyota Industries, while Toyota Fudosan owns 5.32%.

Toyota Industries owns 9% of Toyota Motor’s shares. In late April, news of the possible buyout caused Toyota Industries’ shares to rise more than 40%.