Nidec shares bounce because it proposes unsolicited $1.6 billion Makino takeover bid

Investing.com– Kyoto-based precision motor producer Nidec Corp (TYO:6594) has introduced plans to launch a 257 billion yen ($1.6 billion) tender provide to accumulate industrial gear provider Makino Milling Machine Co Ltd (TYO:6135).

The provide, priced at ¥11,000 per share, represents a 42% premium to Makino’s closing worth on Thursday.

Nidec didn’t talk about the provide with Makino’s board and plans to proceed even with out its approval, supplied regulatory circumstances are met. The tender provide is scheduled to launch on April 4 after Nidec clears regulatory processes, the corporate mentioned.

Shares of Makino had been untraded Friday, whereas Nidec’s inventory jumped greater than 5%.

The provide aligns with Nidec’s technique to develop into higher-margin development sectors because it faces challenges comparable to subdued demand for arduous drives and intense competitors in China’s electrical automobile market.

Nidec, the world’s main producer of mini motors, has been pursuing business consolidation by means of aggressive acquisitions beneath the management of founder Shigenobu Nagamori. Whereas Nagamori stepped down as CEO in April, his successor Mitsuya Kishida continues to push the corporate’s bold development targets.

This transfer shouldn’t be Nidec’s first unsolicited takeover. In 2022, the corporate made a hostile bid for Takisawa Machine Device Co., which finally agreed to the acquisition. The Japanese authorities, aiming to advertise business consolidation, issued M&A tips final yr encouraging such takeovers.

Whereas the corporate is open to negotiating with Makino’s board, Nidec has made it clear that it intends to proceed with the bid no matter Makino’s preliminary response.