TOKYO (Reuters) – Japan’s Nidec Corp., the world’s largest manufacturer of motors used in hard drives, said it was scrapping its unsolicited $325 million bid to buy Toyo Denki Seizo KK, a maker of motors used in railway cars.

Nidec, known for its aggressive pursuits of target companies, said it will not renew its offer to pay 635 yen for each Toyo Denki share, a 88 percent premium on Toyo Denki’s closing share price on Monday.
Nidec is fighting a fierce price war over hard drive motors. It had hoped the deal would help it tap growing demand for train parts in China and North America, but said it had to withdraw due to resistance from Toyo Denki.
Two Nidec spokesmen declined to comment on whether or not the worsening global economic climate affected the firm’s decision.
In the three months since Nidec made its offer, the two sides exchanged letters and met but discussion did not go beyond reiteration of the offer and explanations, the two firms said.
“The possibility that we will come to a common understanding needed to conduct negotiations to raise corporate value at Toyo Denki is extremely low,” Nidec said in a statement.
Nidec’s bid for the maker of inverters and train motors used to control driving gears, doors and cooling fans represents the first time the Kyoto-based firm went public with an offer prior to an agreement.
Nidec, which has grown rapidly through acquisitions that include a majority stake in Fuji Electric Holdings’ industrial motor unit, now holds only 0.002 percent, or 1,000 shares, in Toyo Denki and had offered to take at least a 50.1 percent stake.
Shares of Nidec closed down 0.6 percent at 3,500 yen and Toyo Denki rose 4.6 percent to 338 yen, against a 4.8 percent rise in Tokyo's electrical machinery sub-index.