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Toyota to buy back up to US$4.9b in stock to ease dilution
[TOKYO] Toyota Motor Corp said it will buy back as much as 600 billion yen in stock to avoid dilution from new shares aimed at long-term investors.
Shareholders today approved a proposal to issue Model AA shares, named after Toyota's first car model, at the company's annual meeting in Toyota City, Japan.
Japan's largest company had said in April that it would repurchase "substantially the same number" of common shares to avoid dilution.
The Model AA shares divided proxy advisers and drew criticism from large foreign investors including the California State Teachers' Retirement System for being sold only in Japan and lacking benefit for common stockholders.
Toyota has said its motivation for creating the stock is to attract shareholders who will support the costly investments it makes to develop cars that take years to pay off.
The proposal passed with about 75 per cent of shareholders voting in favour, more than the two-thirds needed to approve, said Kayo Doi, a company spokeswoman. It's unusual for Toyota's company resolutions to receive less than 90 per cent support, she said. A final count of shareholder voting will be released Wednesday.