Toyota Group suppliers Denso, Aisin scale back cross-shareholdings, filing shows

TOKYO (Reuters) – Two of Toyota (NYSE:)’s top suppliers, Denso and Aisin, have sold off holdings in several Toyota-affiliated companies, regulatory filings showed on Thursday, in the latest reduction of cross-shareholding across the sprawling automotive group.

Denso, one of the world’s largest makers of automotive components, had sold off its stakes in Toyota Group companies Toyota Boshoku Toyota Tsusho, Toyoda Gosei and Hino Motors, among others, as of the financial year that ended in March, a filing showed.

Aisin had also reduced its stakes in those companies to zero, as well as sold off its Denso stake, according to a separate filing.

Both still have stakes in other Toyota Group firms. Toyota’s cross-shareholdings have come under renewed focus in recent years as more companies wind down the practice, which has long been seen as a corporate governance black mark because it can lead to a cosy relationship between management and large shareholders.

Shareholder backing for Toyota Chairman Akio Toyoda slid for a second straight year at its annual general meeting this week, with governance concerns playing a role.

Toyota has said that to accelerate its transformation it would sell cross-shareholdings.

Denso in April said it planned to sell all of its cross-shareholdings, as it looks to fund acquisitions and other investments.