Exclusive: Toyota plans around $19 billion share sale by financial institutions, sources say

Core Viewpoint - Toyota plans to unwind strategic shareholdings, involving banks and insurance firms selling approximately $19 billion of its shares, marking a significant moment in Japan's corporate governance reform [1][3]. Group 1: Share Sale Details - The planned share sale is expected to total around 3 trillion yen ($19 billion), with the potential to increase based on shareholder willingness to sell [1]. - The sale is aimed to occur as early as this year, although timing and scale may vary depending on shareholder responses [1]. Group 2: Corporate Governance Reform - This move by Toyota is indicative of the ongoing corporate governance reform in Japan, as regulators and the Tokyo Stock Exchange encourage companies to reduce cross-shareholdings [3]. - Cross-shareholding practices, which have been criticized for insulating management from shareholders, have been prevalent in Japan but are less common in Western markets [4]. Group 3: Investor Relations and Governance - Toyota is under pressure to improve capital efficiency and governance, as it has faced criticism from investors regarding its governance practices [4]. - The company aims to demonstrate its commitment to governance reform by unwinding strategic shares [5]. Group 4: Shareholder Composition - Major shareholders of Toyota include banks like Sumitomo Mitsui Financial Group and Mitsubishi UFJ Financial Group, as well as insurers such as MS&AD Insurance Group [6].