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12/18/2025

Toyota Industries Buyout Bid Dips 16% Below Stock Holdings

Bloomberg (12/18/25) Takahashi, Nicholas

Toyota Group’s proposed ¥4.7 trillion ($30 billion) offer to privatize a forklift maker has prompted one of the world’s most tenacious investment funds to call it a lowball offer. A closer look at the company’s shareholdings helps explain why. The buyout company, Toyota Industries Corp. (TYIDY), owns shares valued at ¥5.6 trillion, just shy of the company’s own market value, according to data compiled by Bloomberg. That makes the June buyout offer nearly ¥1 trillion, or 16%, below the value of those shareholdings. Toyota Industries was founded nearly a century ago as a loom maker by the great-grandfather of Toyota Motor Corp.’s (TM) current chairman, who heads the real estate firm leading the buyout. Besides the historical significance of Toyota Industries, the bulk of its holdings are those of other group firms, making Toyota Industries a strategic company. What’s more, Toyota Industries had ¥506 billion in cash, equivalents and short-term investments at the end of September, according to data compiled by Bloomberg. The gap between the take-private proposal and the value of Toyota Industries’ holdings has become a major sticking point for Elliott Investment Management, which has built a 5% stake in the company, and is said to have been talking to Japanese funds to gain support for its campaign against the buyout offer. The offer price “is a matter of discussion and agreement between Toyota Fudosan and Toyota Industries Corporation,” a Toyota Motor spokesperson told Bloomberg. Toyota Industries said it maintains constructive discussions with all its shareholders but declined to comment on the actions of any specific investor. A Toyota Fudosan spokesperson said the company is aware of the situation and is watching share movements carefully. It’s common in Japan for publicly traded companies to hold stakes in each other, partly to cement business ties. The market value of Toyota Industries’ largest 10 cross-shareholdings has gone up more than 20% since the take-private offer was announced. A group led by Toyoda announced plans in June to privatize Toyota Industries, once a maker of textile looms that gave birth to what is now the world’s biggest carmaker. The proposal included a tender offer of ¥16,300 for each share of Toyota Industries, or an 11% discount to the company’s closing price on the day it was announced. Toyota Industries shares closed trading on Thursday at ¥17,725, up 38% for the year. A group of investors, in a letter submitted in August to the boards of Toyota Motor and Toyota Industries, called for more transparency in how the group arrived at that valuation. “Central to our concerns is the lack of full valuation disclosure,” the group said, citing numerous issues including limited price negotiations, no exclusion of conflicted parties in the minority vote and an opaque valuation methodology with no disclosures around financial projections, among others. A special-purpose company will be created to private Toyota Industries, which in turn will mostly be owned by Toyota Fudosan Co., an unlisted real estate firm chaired by Toyoda. The founding family’s scion will also personally invest ¥1 billion in the new entity. The takeover bid had been scheduled to start in December, but it was postponed until at least February after the approval process was delayed by antitrust regulators in various countries.

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12/18/2025

Elliott Woos Toyota Industries Investors in Buyout Fight

Bloomberg (12/18/25) Du, Lisa; Tsutsumi, Kentaro

Elliott Investment Management has been approaching asset managers and other institutional investors in Japan to build support for its campaign and push Toyota (TM) group to sweeten its ¥4.7 trillion ($30 billion) bid to take a key affiliate private, according to people familiar with the matter. Billionaire Paul Singer’s activist fund, which has quickly built a 5% stake in Toyota Industries Corp. (TYIDY), has been meeting with passive investors and other domestic shareholders, and telling them the proposal doesn’t reflect the company’s true value, said the people, who asked not be identified as they were not authorized to speak publicly. The meetings came ahead of a tender offer period set to begin as soon as February. Toyota Fudosan Co., an unlisted real estate company led by Akio Toyoda, the chairman of group flagship Toyota Motor Corp., is leading the offer to take Toyota Industries private. These maneuvers set up a rare, high-profile clash between one of Wall Street’s most prominent activist funds and Japan’s corporate establishment. Elliott’s involvement in what could be one of the world’s biggest buyouts has raised questions about whether the deal will be able to go through as planned. The bid for the company, a maker of looms and forklifts that fathered Toyota Motor, was announced in June but has drawn criticism from investors who say the ¥4.7 trillion price undervalues the company. Elliott, which has signaled it could raise its stake in Toyota Industries to above 20%, declined to comment, as did Toyota Motor. Toyota Industries said it maintains constructive discussions with all its shareholders but declined to comment on the actions of any specific ones. Toyota Fudosan wasn’t immediately reachable. The ¥16,300-a-share buyout offer requires about 20% of Toyota Industries shares to be tendered by minority shareholders to go ahead. The stock rose 0.7% in Tokyo before paring gains. Toyota Industries’ stock price has traded above the offer price since late August, and exceeded it by more than ¥1,500 a share recently, signaling investors are anticipating the offer to be raised. The stock price rising above the Toyota Fudosan bid also lowers the incentive for minority shareholders to tender their shares as they could get more money in the open market. Elliott’s not alone in voicing concerns about the deal. More than two dozen investors, including a handful based in Japan, sent a letter in August to the boards of Toyota Industries and Toyota Motor that said the deal lacked transparency and hurt minority shareholders. “It is difficult to ignore the number of shareholders asking these questions, and they are drawn from several different corners of the investment community,” according to a ISS Stoxx GmbH Dec. 9 note. “Still, to challenge the Toyota group is to challenge the establishment.” Elliott’s chances of extracting concessions from one of Japan’s most powerful companies are better than most. It has just succeeded in a management change at BP Plc (BP), and is challenging companies ranging from PepsiCo Inc. (PEP) to Barrick Mining Corp. (B) and Rexford Industrial Realty Inc. (REXR). The firm has also built a stake of more than $1 billion in Lululemon Athletica Inc. (LULU), according to a person familiar with the matter. Toyota Industries was founded by Toyoda’s great-grandfather Sakichi, whose son Kiichiro went on to create Toyota Motor, which makes up the core of Japan’s biggest business group and is the world’s largest automaker. Akio led Toyota as chief executive officer for 14 years until 2023, when he became chairman. Supporters of the tender offer have defended it by saying it represents a premium to the stock price prior to news of the buyout becoming public in late April, when the shares traded at around ¥10,765. Toyota Motor's chief executive officer, Koji Sato, said in late October that Toyota Fudosan had no plans to sweeten its existing offer. Elliott is focused on Toyota Industries’ stakes in other companies, people familiar with the matter have said, which are rising in value. It’s common in Japan for publicly traded companies to hold stakes in each other, partly to cement business ties. The market value of Toyota Industries’ largest 10 cross-shareholdings has gone up nearly 30% since the take-private offer was announced.

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12/18/2025

Activist Investor Corvex Calls for Strategic Review at Premier Inn-Owner Whitbread

Reuters (12/18/25) Kalia, Yamini; Job, Raechel

Corvex Management urged Premier Inn owner Whitbread (WTBDY) to review its strategy and 3.5-billion-pound ($4.68 billion) capital plan on Thursday, citing a gap in valuation after recent UK budget changes saddled it with more costs. The hedge fund, founded by Keith Meister, a former protege of Carl Icahn, disclosed a 6% stake in Whitbread and said it would seek board seats to push Britain's largest hotel operator to evaluate a "full range of options" with independent advisors. Whitbread shares rose 5.5% to 2,579 pence by 1110 GMT. They have fallen about 12% so far this year, valuing it at about 4.15 billion pounds. "Whitbread has a clear strategy and business model," Whitbread said in an emailed statement to Reuters. U.S.-based Corvex is now Whitbread's second-largest shareholder, just behind private equity giant BlackRock (BLK), according to LSEG data. "We believe the company must evaluate all available strategic options with the objective of maximizing value for all shareholders," it said, pointing out that Whitbread's investment size was now approaching its market capitalization. The fund also said Whitbread's current share price appeared to assign no value to several components of the business, including its UK leasehold portfolio, German hotel assets and properties under construction. "Our five-year plan is designed to deliver strong returns for shareholders through growth in both the UK and Germany," Whitbread said in response. The group, which has over 840 hotel sites in the UK, warned last month that new budget measures would add 40 million to 50 million pounds in costs next fiscal year, dealing what one Bernstein analyst called a "hammer blow" to its plan to boost margins and profits. Whitbread had said it would explore options to offset the hit from the budget, in which taxes on high-value commercial properties were raised. The hospitality industry was already under pressure due to labour shortages and higher costs in the wake of the pandemic.

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12/18/2025

Barrick Mining Officially Resumes Operational Control of Mali Mine, Memo Shows

Reuters (12/18/25) Crowe, Portia; Rajagopal, Divya

Canada's Barrick Mining (B), which has Elliott Capital as one of the shareholders, has officially resumed operational control of its Mali gold mine, according to a company memo seen by Reuters. Barrick will resume production gradually and will focus on mandatory training for employees and contractors, according to the memo sent by Sebastiaan Bock, Director of Operations for Africa and the Middle East. The two sides reached an agreement last month to resolve their dispute over Barrick's operations in the West African country after two years of negotiations. The disagreement over the implementation of a new mining code introduced by the military-led government led to Barrick suspending operations at its gold mining complex in January, and a Malian court-appointed provisional administrator taking control in June. Barrick agreed to a settlement worth $430 million, a source said. Last week a Malian judge ordered the return of possession of Barrick's three metric tons of gold seized by the country's military government nearly a year ago to the company, according to two people familiar with the matter. The gold, worth about $400 million, was seized by a military helicopter in January following a confiscation order from a Malian judge. It has remained at the BMS bank in Mali's capital, Bamako, since then, according to both sources. Barrick announced plans to focus on its North American operations, including an IPO for this business under its interim CEO, Mark Hill.

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12/17/2025

Activist Fund Pushes SPS Commerce Toward Ownership, Leadership Changes

Minnesota Star Tribune (12/17/25) Kennedy, Patrick

An investment fund has purchased shares in Minneapolis-based SPS Commerce (SPSC) and is pushing for changes, including a potential sale of the company or change in leadership. SPS Commerce, which provides systems that help retailers and companies that sell to them manage supply chains, has been one of the most consistent financial performers among Minnesota-based technology stocks. Recently, though, its shares have sunk and Anson Funds Management has noticed. The Toronto-based firm would not confirm how many SPS shares it owns. But a source familiar with Anson said the firm had a “notable position.” The manager of Anson’s activism strategy, Sagar Gupta, talked about its stake in SPS Commerce at the Bloomberg Activism Forum 2025 on Dec. 9. Anson, which has more than $2.3 billion in assets, focuses on small and midcap companies. In his presentation, Gupta said the firm is concerned about SPS' underperformance under CEO Chad Collins, who took the helm from longtime chief executive Archie Black two years ago. Collins led several acquisitions, including the two biggest in the company's history: software publisher SupplyPike Inc. in August 2024 and Toronto-based Carbon6 Technologies in December 2024. Both deals were valued between $205 million and $210 million. Anson wants SPS to stop its mergers-and-acquisitions activity, perform an operational review driven by outside consultants and potentially make a change in leadership or ownership of the company. “Following a series of earnings expectations misses, guidance cuts, poor M&A performance and an underwhelming Investor Day, the investment community appears to have lost confidence in management,” Anson noted in its presentation. SPS said in a statement that its board of directors and management are committed to the best interests of the company and shareholders. “We regularly engage with our investors and thoughtfully evaluate all input that advances our goal of creating sustainable long-term value,” the statement said. The company has continued to grow. For nearly 25 years, or 99 consecutive quarters, SPS has increased revenue. However, revenue growth in the third quarter was 16%, the slowest rate in the last 12 quarters. It missed analysts' third-quarter expectations for revenue and the company lowered revenue guidance for the rest of the year. For the 2024 fiscal year, revenue grew 19% to $637.8 million. The company said this year's growth is expected to be closer to 18%. Earnings — which increased nearly 70% since 2020 — are expected to grow more than 13%, the company said. But even though revenue and earnings have increased, SPS shares are down 52% this year. After both the second and third quarter results, they dipped 20%. Anson also pointed out that SPS has not been able to meet its long-term profit margin ratio of 35%. Analysts have recently downgraded SPS over its growth prospects and a macroeconomic environment where retailers are tightening their spending amid tariff pressures. On Oct. 30, Cantor analyst Matthew VanVliet downgraded SPS from overweight to neutral. On Oct. 31, Craig-Hallum analyst Jeff Van Rhee downgraded his 12-month price target on SPS Commerce to $125 a share. And on Nov. 11, Morgan Stanley (MS) equity analyst Chris Quintero downgraded SPS from overweight (buy) to equal-weight (hold). Mark Schappel, a managing director and analyst at Loop Capital, noted in a research note that one contributor to the third quarter revenue miss was a recently acquired business that fell short of expectations. After Anson's Dec. 9 presentation, Schappel issued another note saying that taking SPS private “could make sense.” “We think many investors would likely welcome such a transaction amid the challenges of slowing growth, execution lapses, the hurdles of evolving into a multi-product company, and the need to enter a potential investment cycle to regain momentum,” he wrote. Anson noted in its presentation that a prior activist campaign by investors Legion Partners and Ancora Advisors in 2018 led to two new directors being named to the board of directors and helped drive increased financial and share performance at SPS Commerce.

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12/17/2025

'Final Fantasy' Maker and Activist Investor Seek New Path Forward

Bloomberg (12/17/25) Mochizuki, Takashi

3D Investment Partners has been nudging shares of Square Enix Holdings Co. (9684) both lower and higher over the past week. First, the Singapore-based outfit incited investor frustration for not being radical enough in suggesting reforms to revive the struggling games maker. Then, it reignited hopes that such proposals may be imminent. The activist group last week published a detailed 112-page letter criticizing Square Enix President Takashi Kiryu and urging fellow shareholders to support its campaign for change. It wasn’t well received, as Square Enix shares fell more than 9% over the course of the week. The stock recouped some of those losses this week after 3D disclosed it had increased its stake and suggested it would submit “important” proposals to management. 3D’s involvement first became public in April, prompting hopeful speculation about its intentions. The fund has a track record of pressuring companies such as Sapporo Holdings Ltd. to take aggressive steps to boost shareholder value. Its stake-building also followed news that Square Enix Honorary Chairman Yasuhiro Fukushima sold his Tokyo mansion, raising questions about whether he — the founder and largest shareholder with just under 20% — might eventually divest his holdings. “There was a lot of hope baked into the stock,” Bernstein analyst Robin Zhu said. And that’s why the initial set of ideas from 3D for Square Enix seemed to be greeted as something of a letdown. So far, 3D’s public actions toward the Final Fantasy maker have been limited to accumulating shares and authoring a letter that largely reiterates long-acknowledged challenges. The fund has not yet offered particularly bold actions such as major asset sales. “When 3D first came in, investors hoped they might push for asset sales or some hidden way to unlock value — even a full sale of Square Enix with a takeover premium,” said UBS Securities analyst Yijia Zhai. “But their proposal does not seem to be able to surprise investors. With no additional value in sight, event-driven investors are now pulling back.” As the 3D letter notes, Square Enix has struggled for years to deliver blockbuster hits — a problem blamed on poor management of the development pipeline, overreliance on Sony Group Corp.’s PlayStation at a time when Nintendo Co.’s Switch platforms have boomed, and an excess of low-quality releases that alienated fans. A high cost structure to game production also weighed on profitability. But these issues largely accumulated under former President Yosuke Matsuda, not Kiryu. Since taking the helm in 2023, Kiryu has led sweeping restructuring efforts: canceling unprofitable mobile titles, streamlining development processes, revamping internal teams and shuttering overseas studios. Under its three-year plan through March 2027, Square Enix is focused on downsizing, with major big-budget titles expected in the following period. Soichiro Fukuda, senior analyst at Tokai Tokyo Intelligence Laboratory, said the company is moving in the right direction. “The company is already doing quite a lot itself,” he said. “It’s just a case of waiting now.” A key risk is that Square Enix has acknowledged these reforms will take time — and in that period, its prominence could fade as an onslaught of competition hits game stores each day and competes for finite attention. Developers globally say it’s increasingly difficult for new games to stand out, as players remain committed to a limited set of long-running live-service titles. Square Enix doesn’t have a good answer for how it’ll maintain its brand recognition without commanding such a title. The company’s flagship role-playing game franchises, Final Fantasy and Dragon Quest, remain iconic. But recent entries have leaned heavily on remakes, and their core fans are aging. Serkan Toto, chief executive officer of a game industry consultancy, said both game brands may be past their peak. “Large parts of the gamer population in Japan and elsewhere simply have lost interest in Dragon Quest and Final Fantasy over time,” Toto said. “Both lost a lot of their thunder in the last 10 to 15 years, and Square Enix seems out of touch with the mass market that is now jumping on Chinese-made RPGs instead.” As UBS’s Zhai says, the real test will be whether Square Enix can develop fresh, big-budget franchises capable of supporting the business for years to come. Debating that now may be premature, but 3D’s intervention is bringing the issue to the fore. Kiryu can still count on fan loyalty built up over decades and a measure of patience from investors who’ve waited on the sidelines for years. The challenge now is to deliver — while that goodwill remains.

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12/17/2025

Elliott Management Trims Stake in Southwest Airlines, Expresses Confidence in Profitability

Seeking Alpha (12/17/25) Thielen, Amy

Elliott Investment Management has trimmed its stake in Southwest Airlines (LUV) to 51,128,500 shares, representing a 9.9% stake, below the 10% threshold necessary to call for a special shareholder meeting. In a filing with the U.S. Securities and Exchange Commission, Elliott Investment Management said that while it reduced its holdings in Southwest Airlines, it plans to remain a “significant shareholder based on its confidence that [Southwest’s] execution of ongoing strategic initiatives will translate into greater profitability, accretive capital-allocation opportunities and shareholder value creation.” Elliott began accumulating a stake in the carrier last year in an effort to force changes that would restore shareholder value by reshuffling its board of directors and replace CEO Bob Jordan. The investment fund requested a special shareholder meeting last December in what appeared to be the first salvo in a proxy fight with the airline. To placate Elliott, Southwest made operational changes, refreshed its board with six new directors, increased the amount Elliott can acquire to 19.9% from 14.9%, and announced the accelerated retirement of Executive Chairman Gary Kelly. In return, Bob Jordan would remain as CEO and Elliott would abandon any efforts to initiate a proxy fight. After a year of cost-cutting and conducting what the carrier considered its “most significant transformation in the airlines' history,” Southwest reported better-than-expected results for the third quarter and set upbeat guidance for the current quarter. Accordingly, Southwest shares have gained 30% since October and recently enjoyed an eleven-day winning streak, culminating in a 3 ½ year high for the stock.

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12/17/2025

Elliott Builds Over $1 Billion Stake in Lululemon

Wall Street Journal (12/17/25) Thomas, Lauren

Activist Elliott Investment Management has built a stake of over $1 billion in Lululemon Athletica (LULU) and is bringing a potential CEO candidate to the struggling athletic apparel retailer it wants to help turn around, according to people familiar with the matter. The stake makes Elliott among the biggest investors in Lululemon, which has a market value of around $25 billion. It is a tumultuous time for Lululemon, which announced last week that Chief Executive Officer Calvin McDonald will step down in January and that the business faces pressure to reverse many missteps from quality issues to “losing its cool.” Elliott has been working closely with veteran retail executive Jane Nielsen, a former chief financial officer and chief operating officer at Ralph Lauren (RL), who they see as a potential Lululemon CEO candidate, the people familiar with the matter said. The activists' arrival, and CEO candidate, comes as Lululemon founder Chip Wilson had already been agitating for change and weighing in on the CEO search. Before McDonald's departure was announced, Wilson had been attacking Lululemon publicly for killing innovation and losing what made the brand “cool” in the first place. McDonald, who had served as an executive at beauty chain Sephora (LVMUY), took the helm of Lululemon in 2018 and steered the business through the pandemic, tripling its annual sales during his tenure to $10.6 billion. He is expected to give up his board seat but remain a senior adviser through March to facilitate a smooth transition. The Vancouver-based retailer revolutionized athletic apparel with leggings that were so functional and flattering that people wore them to not only yoga class but brunch, the supermarket, and just about everywhere else. A crop of newer athletic apparel competitors including Vuori and Alo Yoga have eaten into market share, but Lululemon has made missteps on its own, analysts and customers say. Recent decisions, including deals to sell apparel embellished with Mickey Mouse or NFL logos, have raised eyebrows. Lululemon has also leaned more heavily into discounting products, weighing on profits and the brand's image. Merchandise piled up in stores, leaving them cluttered. Lululemon shares have collapsed more than 60% from their peak, leaving the company trading at multiples below other retailers, including American Eagle Outfitters (AEO) and Victoria's Secret (VSCO), according to analysts. In Nielsen, Elliott sees a retail pro that can help revitalize the Lululemon brand, the people familiar with the matter said. Elliott and Nielsen have been working together on evaluating this opportunity for months, the people added. “Lululemon is one of the most powerful brands in retail, defined by exceptional products, deeply engaged communities and significant global potential,” Nielsen said in a statement to The Wall Street Journal. “I would welcome the chance to discuss this opportunity with the Lululemon board.” Before joining Ralph Lauren in 2016, Nielsen was the finance chief at handbag maker Coach. During her tenure there, Coach (TPR) closed underperforming stores and got inventory under control, helping the namesake brand post its first quarterly sales increase in North America in almost three years. During her time at Ralph Lauren, shares more than doubled and profit margins swelled as the apparel maker cut back on discounting—following a similar playbook from Nielsen's Coach days. Nielsen left Ralph Lauren at the end of March. Wilson, the Lululemon founder, has said the Lululemon board needs to find a new CEO with urgency, adding he was “deeply concerned about what appears to be a tremendous failure by the board to competently plan for the future and manage an effective succession process.” Lululemon board chair Marti Morfitt has said the company has a “strong foundation in place” to pick a new leader. Elliott is the biggest investor, with over $76 billion in assets under management. The firm has made a number of other recent investments in the consumer sector, including at PepsiCo (PEP) and Starbucks (SBUX). Earlier this month, Pepsi struck an agreement with Elliott committing to cut costs and lower prices.

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