The world’s largest automaker Toyota would buy out the rest of minivehicle unit Daihatsu - an all-stock deal worth about $3 billion and part of its strategy to strengthen its push into compact cars for emerging markets.
Toyota acquired a controlling interest of 51 percent in Daihatsu in 1988. But now it is raising its stake to 100 percent by a reciprocal share-swap agreement that will see Daihatsu's other shareholders take 0.27 shares in the larger company for each share in the smaller.
This move will help to improve Daihatsu small cars by having a unified strategy in the sengment, although the companies will keep their management structures and "engage in friendly competition". Toyota will focus its development efforts on environment, safety, user experience, and comfort, while Daihatsu will focus on cost-saving and fuel efficiency for its small cars.
"This is an opportunity for us both to stop feeling that we need to go it alone, and trust each other to take full advantage of our respective strengths. In other words, we can now focus on our core competencies. That, I believe, is the key to achieving and sustaining global competitiveness." said Toyota President Akio Toyoda
