Toyota says to sell $1.8 billion worth of KDDI shares

TOKYO, July 28 (Reuters) – Toyota Motor Corp (7203.T) said on Friday it will sell a stake worth about 250 billion yen ($1.80 billion) in telecoms company KDDI Corp (9433.T) as part of an effort to raise funds to accelerate vehicle electrification.

The world’s largest automaker by sales last month unveiled sweeping plans to improve the driving range and cut costs of battery electric vehicles (BEVs), including through development of solid-state batteries, as it seeks to catch up on rivals.

Toyota previously rolled out a goal of selling 3.5 million BEVs in 2030 and investing a total of about 5 trillion yen for BEV-related businesses by the end of the decade.

It said in a statement on Friday a “large amount of investment is needed” to survive amid fierce competition and achieve medium- and long-term growth.

Japan’s KDDI will buy back shares at 3,900 yen a piece between July 31 and Aug. 28, Toyota said, or 8.7% lower than KDDI’s closing price of 4,271 yen on Friday.

The sale will cut the automaker’s stake in KDDI to 11.71% from 14.68%.

Toyota’s ties with KDDI date back to that late 1980s, when Japan liberalised its telecommunications sector. The automaker had participated in the founding of one of KDDI’s predecessor companies.

In 2020, Toyota said it would invest 52.2 billion yen in the mobile carrier to deepen their partnership.

They also formed a business alliance for research and development on projects such as telecommunications platforms to connect cars and homes.

($1 = 139.0500 yen)

Reporting by Satoshi Sugiyama; Editing by Tom Hogue and Jacqueline Wong