TOKYO (Reuters) - Toyota Motor supplier Denso plans to eventually sell all of its cross-shareholdings, its president said on Friday, as the company looks to fund acquisitions and other investments.
WHY IT'S IMPORTANT
Investors have long pressured Japanese companies to sell-off cross-shareholdings and put their capital to better use. Firms have been gradually selling down their stakes, thanks in part to a governance push by the Tokyo Stock Exchange and the government.
Toyota and some other of its group companies last year sold around 8% of Denso, a move that was seen as a critical first step by the sprawling Toyota Group and heightening expectation of more sales to come.
CONTEXT
* Denso President Shinnosuke Hayashi told a briefing the supplier of auto components will continue selling its cross-shareholdings, with the intent to sell all of them, after holding talks with the companies involved.
* Denso, which doesn't disclose the size of its cross-shareholdings, in March announced plans to sell all of its 9.1% stake in Toyota Industries.
* It has also cut holdings in JTEKT, another group company.
KEY QUOTES
"Basically, we are not going to hold a portion of the shares, but rather we are moving towards selling all of our shares," Executive Vice President Yasushi Matsui told the briefing.
* Hayashi said the elimination of cross-shareholdings was important for increasing the competitiveness of the entire industry.
BY THE NUMBERS
* Denso reported a 11% decline in full-year operating profit on Friday.
* It forecast an 88% profit increase for the year to March, for 714 billion yen ($4.6 billion).
($1 = 156.6300 yen)