(Press release provided by Standard & Poor's Corp)
TOKYO, Dec 27 - Standard & Poor's Ratings Services said today that its rating on Toyota Motor Corp. (AAA/Negative/A-1+) is unlikely to be negatively affected by the probable extension of support to troubled general trading company Tomen Corp. ('CCpi').
Tomen today announced a new midterm management plan involving integration with Toyota Tsusho Corp. (a 22.9% owned affiliate of Toyota Motor), and a proposed JPY10 billion capital injection by Toyota Tsusho and other Toyota group companies.
At this stage, Standard & Poor's expects that Toyota Motor's potential involvement in Tomen will be limited to a one-time minority level investment. As a result, Standard & Poor's does not believe that Tomen's debt should be considered a contingent liability for Toyota Motor.
Toyota Motor has previously invested capital in institutions such as Sakura Bank (now part of Sumitomo Mitsui Banking Corp. ) and Sanwa/Tokai Banks (now part of the UFJ group ). Given the difficult external environment, Toyota Motor faces the risk of being asked to provide operational or financial support to ailing companies and financial institutions with weak capitalization.
Going forward, the rating on Toyota Motor could come under pressure if the automaker decides to extend significant financial support to troubled companies and financial institutions that are not connected to its core business.
Standard & Poor's Ratings Services