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NTT to launch $16.5 billion tender offer for NTT Data in AI push
NTT plans a $16.5 billion tender offer to acquire the remaining shares of its AI subsidiary, NTT Data, at ¥4,000 per share, a 34% premium. The tender offer will run until June 19, aiming for NTT Data to delist after the transaction. Following the announcement, NTT Data shares surged 17%, while NTT's stock fell by 2.1%. NTT currently owns 57.73% of NTT Data.
Key points
- NTT initiates a tender offer for NTT Data to fully own it as part of an AI investment strategy.
- The offer is for ¥2.37 trillion ($16.5 billion) at a price of ¥4,000 per share, which is a 34% premium.
- Tender offer period is from Friday to June 19; NTT Data will delist post-tender.
- NTT Data's shares rose by the maximum 17% upon the announcement, marking a 25-year high.
- In contrast, NTT's shares experienced a decline of 2.1%.
Why it matters
- The move aligns with the increasing trend of conglomerates consolidating their subsidiaries to enhance focus and investment, especially in AI and tech fields.
- By 2025, many companies are expected to invest heavily in AI, reshaping industries and potentially leading to more mergers and acquisitions.
- Japan has seen a trend of parent companies absorbing their listed subsidiaries, reflecting a shift in corporate governance.
NTT's acquisition of NTT Data signals its commitment to AI growth, aligning with global trends of corporate consolidation in tech, expected to take shape more prominently by 2025.