By Kosaku Narioka

Swiss asset manager GAM Holding is opposing a planned takeover of a Honda Motor subsidiary by Indian auto-parts maker Samvardhana Motherson International, saying the deal significantly undervalues the Japanese company.

GAM Chief Executive Albert Saporta said the asset manager sent a letter to the president of auto-parts maker Yutaka Giken, urging the Honda unit to either abandon the transaction or seek a significantly higher price.

Samvardhana Motherson said in late August that it planned to acquire an 81% stake in Yutaka for about 27 billion yen, equivalent to $172.4 million.

As part of the deal, Samvardhana Motherson plans to start a tender offer to buy Yutaka shares for Y3,024 each from minority shareholders, valuing the company at about Y45 billion. The Indian company said it aims to commence the tender offer in late January 2026 once it receives regulatory approvals.

Hamamatsu-based Yutaka is a profitable, cash-rich company that makes parts for exhaust systems, drive systems, brake discs and heat-management devices. It had about Y104 billion in net assets as of the end of September, with equity at 61% of assets. Honda holds about a 70% stake in Yutaka.

In the letter to Yutaka, GAM CEO Saporta said it was especially disturbing that a company as prominent as Honda could demonstrate a blatant disregard for minority shareholders' rights despite Japan's strides in corporate governance over the past decade. GAM has been an active participant in the Japanese market for several decades, he said.

"In all these years, we have never witnessed such an egregious takeover offer," he wrote in the letter.

Saporta said that the tender offer should be at least 50%-70% above the current offer price and that the deal is a big step backward for Japan's recent efforts to improve corporate governance.

Samvardhana Motherson's offer was 6.4% higher than the closing price of the day before it announced the acquisition plan. Yutaka in late August supported the tender offer and recommended that shareholders tender their shares.

Saporta said that GAM funds had held shares in Yutaka before Samvardhana Motherson announced its tender offer plan and that GAM isn't opposed to the sale of Yutaka itself. He said the acquisition of Yutaka could enable Samvardhana Motherson to realize significant synergies and additional revenue opportunities.

Yutaka, Motherson and Honda didn't immediately respond to requests for comments.

A number of Japanese companies have in recent years taken full control of listed units and affiliates or sold them, as the Japanese government has pressed businesses to improve capital efficiency and corporate governance. That has led to waves of acquisitions in Japan by domestic and foreign investors.

Write to Kosaku Narioka at kosaku.narioka@wsj.com

(END) Dow Jones Newswires

December 29, 2025 05:10 ET (10:10 GMT)

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