Itochu, a Japanese trading company, has announced its consideration of an investment in Bigmotor following the car dealer’s high-profile insurance fraud scandal.
Itochu, along with its subsidiary Itochu Enex Co. and investment fund J-Will Partners, has secured exclusive negotiation rights and is set to initiate due diligence. A final decision on the investment is expected by the next spring, according to a report from Kyodo News.
The investment plan is contingent on the condition that Bigmotor's founding family will no longer participate in the company’s management. Itochu stated that the due diligence process would assess the potential for a successful turnaround of Bigmotor.
In a separate statement, Bigmotor President Shinji Izumi expressed the company's commitment to regaining trust. The proposed strategy by the Itochu-led group involves spinning off a segment of Bigmotor's operations deemed viable and injecting investment into it. This move is aimed at leveraging synergies with Itochu’s existing automotive ventures.
Itochu holds a significant stake in Tokyo Century Corp., which operates car rental services. Additionally, it owns Yanase & Co., an importer of luxury cars.
A few days ago, the Financial Services Agency of Japan announced that it is set to rescind the insurance agent registration of Bigmotor on Nov. 30, following the exposure of fraudulent activities in the company's auto insurance claims.
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