Shares Toyota Industry Fall as much as 13% On Wednesday, Toyota Group reported a 47 trillion yen ($33 billion) deal to privatize the company.

This includes a tender offer for Toyota Industrial stock, which is 16,300 yen per person, which is significantly lower than the 18,400 yen closed on Tuesday before the deal was announced on Tuesday, Reuters reported.

Toyota Group will create a new holding company in the deal, with the group's real estate Toyota Fudosan investing about 180 billion yen, while Toyota Motor Chairman Akio Toyoda will invest 1 billion yen. Toyota will invest approximately 700 billion yen in non-voting preferred stocks.

Other financing will be backed by loans from Sumitomo Mitsui Bank, MUFG Bank and Mizuho Bank.

The deal is behind a wider movement in Japan, where companies face increasing pressure from regulators and investors to relax long-estimated cross-equity links. The Japan Financial Services Agency has been calling for a reduction in cross-equity arrangements.

“Toyoda’s investment may be symbolic, enhancing the unity of the Toyota Group, although its size does not give him full control of Toyota Industries,” Satoru Aoyama, head of ratings at Fitch Ratings in Japan, told CNBC.

"Protecting the Toyota industry from acquisition threats is nothing new; Toyota Group hired cross-equity in 2005 to protect this threat," Aoyama added.

Back in April, Toyota said it was exploring investments in the potential $42 billion acquisition of the Toyota industry. Toyota Motor was developed from Toyota Industries in 1937 and stated in a regulatory filing that it was "exploring various possibilities, including partial investment."

Arun George, global equity research analyst at Smartkarma, said there are some factors that suggest the proposal is “unattractive.”

The Special Committee negotiated several times with the offeror to show that it has made real efforts to ensure the best deal.

George noted that even then, the midpoint of the valuation range given by the independent financial adviser was below the midpoint.

"The Special Committee asked the offeror to raise its JPY16,300 final proposal, but was rejected," George said.

Toyota Industries, which founded Toyota Motors, produced a range of products including forklifts, engines, electronic components and stamping molds.