The potential for M&A remains a tailwind for companies in the Robotics and Automation sector, as reinforced by headlines this week
Toyota Motor Eyes Takeout of Toyota Industries
Japan-based Toyota Industries saw its shares surge almost 23% on Monday after Toyota Motor’s Chairman Akio Toyoda was reported to have discussed a potential ~$44 billion acquisition offer. This represents a significant premium over Toyota Industries’ recent trailing market capitalization of $28 billion.
Toyota Industries Corporation was founded in 1926 as Toyoda Automatic Loom Works to manufacture automatic looms. The company later established an automotive division, which was spun off as Toyota Motor. Today, Toyota Industries is a global leader in material handling equipment and automotive components. It serves as a cornerstone of the Toyota Group.
The company holds dominant market positions across several key sectors, ranking No. 1 globally in industrial trucks and equipment. It has a 40% market share and standing as the world’s largest manufacturer of car air-conditioning compressors. Toyota Industries also manufactures Toyota’s RAV4 SUV. It also produces engines and electronic parts, including batteries and converters.
The deal, if finalized, would expand an existing strategic partnership. as Toyota Motor already owns approximately 24% of Toyota Industries, showcasing Toyota Motor’s commitment to strengthening its manufacturing and automation capabilities.
M&A Has Been Key Tailwind in Robotics & Automation
Monday’s jump represents Toyota Industries’ biggest single-day gain on record. It puts the company’s market cap at $37 billion. Toyota Industries is a constituent of the ROBO Global Robotics and Automation Index (ROBO).
ROBO includes companies across the entire robotics automation value chain. It provides exposure to established leaders and emerging innovators in fields ranging from industrial automation and manufacturing to healthcare technology and logistics solutions.
Since ROBO’s inception in 2013, there have been 30 takeover attempts on index constituents. For investors drawn to the robotics and automation sector for its exciting growth outlook, M&A represents another potential tailwind for performance. as over 50% of index constituents are small- or midcap.
ROBO is the underlying index for the ROBO Global Robotics & Automation Index ETF (ROBO ).
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