The Yamaha Corporation announced today that it will be selling 8 million shares of its holdings in Yamaha Motor Co., a movement of shares that will see roughly 2.3% of the voting power in the powersports company changing hands.
This deal is expected to close on December 4th, and the Yamaha Corporation says that it will be selling its position to various unnamed securities companies, presumably to then be sold on the open market.
At the current market price for Yamaha Motor stock, this deal should be worth close to ¥26 billion, and ¥18 billion after tax expenses have been factored.
The news means that while the Yamaha Corporation will remain the single largest shareholder in Yamaha Motor Co., its ownership position as a shareholder will drop from 12.22% to 9.93%, as a result of the divestiture.
Crossing the 10% ownership threshold has the effect of categorizing the Yamaha Corporation as no long a “major shareholder” in the Yamaha Motor Company.
Speaking to this point, the Yamaha Corporation said that “the Company will maintain cooperative relationships with Yamaha Motor.”
“However, on the other hand, as a result of consideration from various points of view, including capital efficiency, the Company has decided to reduce its holdings of Yamaha Motor shares to a level where the Company will not be included among major shareholders,” the company’s press release continued.
The timing of the move is an interesting one. This is because just after Yamaha Corporation announced its plans to sell stock in Yamaha Motor Co., the Japanese behemoth also announced its intentions to buyback up to 7 million shares of its own stock.
That deal will cost the Yamaha Corporation close to ¥25 billion. and it will take place between December 1, 2017 to May 31, 2018.
Stock prices for both the Yamaha Corporation (5.2x) and Yamaha Motor Co. (4.2x) have been steadily rising over the past five years. Though, the motives for the stock sale/repurchase remain unclear at this point in time.
Source: Yamaha Corporation