Toyota Motors considers investing in potential $42b buyout of key supplier

TOKYO, Apr 27 (Reuters): Toyota Motor said it is exploring the possibility of investing in a potential buyout of key parts supplier Toyota Industries - a buyout that reportedly could cost $42 billion.

"We are currently exploring various possibilities, including partial investment," the automaker said in a filing with the Tokyo stock exchange on Saturday following reports about the possible buyout.

Bloomberg News reported on Friday that Toyota Chairman Akio Toyoda and his founder family have proposed acquiring Toyota Industries in a possible 6 trillion yen ($42 billion) deal.

Toyota Industries, which has a market value of 4 trillion yen, said in a statement it had received proposals about going private through a special purpose company but denied it had received a buyout proposal from the Toyota chairman or the Toyota group.

Two sources familiar with the matter said Toyota Industries is considering tapping Toyota and its group companies as well as major banks to fund a buyout. They also said the proposal did not come from Akio Toyoda or the Toyota group.

The sources, who declined to be identified as the matter is not public, said if Toyota Industries were to go private, it would help improve the Toyota group's corporate governance as cross-shareholdings would be unwound.

Both Toyota and Toyota Industries said in their statements that nothing has been decided.