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GT Capital invests $200 million in Toyota.

GT Capital Holdings Inc. is investing roughly $200 million in Toyota Motor Corp. (TMC), Japan's top automotive company, in a move that marks the conglomerate's first major offshore investment.

The move comes at a time when Toyota, the fifth largest company in the world, is embracing the global automotive industry's once-in-a-century's transformational period by introducing car-sharing services instead of just the usual traditional vehicle ownership.

But the investment doesn't come as a surprise because Toyota and GT Capital are partners in Toyota Philippines for 30 years now.

The investment is also in line with GT Capital's vision to continue strengthening in areas where it is competent.

'Opportunities come, we look at it,' GT Capital and Toyota Philippines vice chairman Alfred Ty told The STAR on Wednesday when asked about future investment plans of GT Capital.

In a disclosure yesterday, GT Capital said it would buy shares of TMC worth 22.2 billion yen.

The purchase would be funded by debt and executed on the Tokyo Stock Exchange, based on the current prevailing rates on the dates of execution, GT Capital said.

'The investment is both strategic and opportunistic. Opportunistic because TMC announced a share buy back program last month and thus it is timely to take a position...The dividend yield also gives a positive carry,' GT Capital president Carmelo Bautista said.

He said the investment is strategic because Toyota is making a pivot from automobiles to mobility.

'And since we have been global strategic partners for the past 30 years, we subscribe to this strategic shift with this investment,' Bautista said.

Toyota has announced plans to invest in a trial car sharing service in parts of central Tokyo, providing options for customers, other than just the usual traditional car ownership.

GT Capital will acquire less than 0.1 percent of Toyota, valued at $208.7 billion.

In the last two years, Philippine companies with dominant market positions have been exploring opportunities outside the country, investing in a wide range of businesses - from vineyard to Angus beef.

In the first quarter, GT Capital grew its first quarter net income by 18 percent to P3.8 billion.

GT Capital shares gained 1.96 percent yesterday, bucking the general bearish market trend.

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Publication:Philippines Star (Manila, Philippines)
Date:Jun 29, 2018
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