GT Capital Holdings Inc., the investment company of billionaire George Ty, said Wednesday it will invest up to $200 million or 22 billion yen in Japanese automotive giant Toyota Motor Corp.
The move is the first overseas investment of GT Capital, which already has a 51-percent direct ownership of Toyota Motor Philippines Corp., the local distributor of Toyota brand motor vehicles in the Philippines.
GT Capital said in a disclosure to the stock exchange it would purchase Toyota shares through the Tokyo Stock Exchange based on the current prevailing rates on the dates of purchase. Funding of the transaction will be through debt.
The acquisition will represent less than a 0.1-percent stake in Toyota, which is valued at $208.7 billion.
This will be the first offshore investment of GT Capital, which is into automotive, insurance, banking and real estate in the Philippines.
GT Capital president Carmelo Bautista said in a mobile message the investment in Toyota would be both opportunistic and strategic for the conglomerate.
“Opportunistic because Toyota announced a share buyback program last month and it is timely to take a position. At current price levels, Toyota is a good investment. Consensus among key research reports point to a +25 percent appreciation. The dividend yield also gives a positive carry,” Bautista said.
“It 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.
TMC and GT Capital are joint venture partners in Toyota Motor Philippines Corp., the country’s leading automotive manufacturer and distributor.
Several Philippine conglomerates including Ayala Corp., Aboitiz Equity Ventures and Metro Pacific Investments Corp. have ventured overseas, particularly the Southeast Asian region.
GT Capital earlier said it would allocated P112 billion for 2018 capital expenditures. It said of the total, over P60 billion would be used to support the expansion plan of banking unit Metropolitan Bank & Trust Co.
The conglomerate also budgeted P20 billion for potential investments, P9 billion for its real estate arm Federal Land Inc. and another P7.9 billion for mass housing unit Property Company of Friends Inc. or Pro-Friends.
Toyota Motor Philippines will spend P6.3 billion to launch new models and expand its logistics. Toyota Financial Services Philippines Corp. will allot P1.9 billion to fund capital call to improve capital ratios and support loan expansion.
The balance will go to the group’s other subsidiaries including Sumisho Motor Finance Corp. and Philippine Axa Life Insurance Corp.