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Toshiba still in talks over chip unit sale one day before deadline

Business2017-09-12

Japan’s embattled Toshiba Corp (6502.T) is still in discussions with various parties over the $18 billion sale of its memory chip business just a day before its latest, self-imposed deadline, people involved in the talks told Reuters on Tuesday. Earlier on Tuesday, the Nikkan Kogyo business daily reported without citing sources that Toshiba has agreed to sell the business to a consortium led by U.S. chipmaking partner Western Digital Corp (WDC.O) for about 2 trillion yen ($18.3 billion). The newspaper said Toshiba will announce the agreement on Wednesday and sign after a board meeting on Sept. 20. Toshiba is desperate to sell the unit to cover billions of dollars in liabilities at U.S. nuclear unit Westinghouse. The board wants the sale, beset by legal wrangling and revised bids, to be decided by Wednesday when it meets, separate people involved in the talks previously told Reuters. The people on Tuesday declined to be identified because the talks were confidential. A Toshiba spokesman said no decision has been made, and that the company will not comment on details of the bidding process. The state-backed Innovation Network of Japan, which is part of the Western Digital-led consortium, held its investment committee meeting on Tuesday without making any decision. Yoshimitsu Kobayashi, an external Toshiba director, said at a press conference on Tuesday at the Keizai Doyukai group of corporate executives, that though the deadline is important, it is also important that negotiations head in a good direction. As well as the Western Digital-backed consortium, which also includes KKR & Co LP (KKR.N), Toshiba has said it is considering a bid led by Bain Capital LP and SK Hynix Inc (000660.KS), and one by Hon Hai Precision Industry Co Ltd (Foxconn) (2317.TW). Western Digital has offered to drop out of bidding and take a stronger position its joint venture with Toshiba instead, but still wants a stake in the chip business in the future, people familiar with the matter previously told Reuters. The people also said Toshiba objected to the possibility of Western Digital eventually seeking control of the chip business, and so has sought a limit on any future stake. (REUTERS)

Japan’s embattled Toshiba Corp (6502.T) is still in discussions with various parties over the $18 billion sale of its memory chip business just a day before its latest, self-imposed deadline, people involved in the talks told Reuters on Tuesday.

Earlier on Tuesday, the Nikkan Kogyo business daily reported without citing sources that Toshiba has agreed to sell the business to a consortium led by U.S. chipmaking partner Western Digital Corp (WDC.O) for about 2 trillion yen ($18.3 billion).

The newspaper said Toshiba will announce the agreement on Wednesday and sign after a board meeting on Sept. 20.

Toshiba is desperate to sell the unit to cover billions of dollars in liabilities at U.S. nuclear unit Westinghouse. The board wants the sale, beset by legal wrangling and revised bids, to be decided by Wednesday when it meets, separate people involved in the talks previously told Reuters.

The people on Tuesday declined to be identified because the talks were confidential.

A Toshiba spokesman said no decision has been made, and that the company will not comment on details of the bidding process.

The state-backed Innovation Network of Japan, which is part of the Western Digital-led consortium, held its investment committee meeting on Tuesday without making any decision.

Yoshimitsu Kobayashi, an external Toshiba director, said at a press conference on Tuesday at the Keizai Doyukai group of corporate executives, that though the deadline is important, it is also important that negotiations head in a good direction.

As well as the Western Digital-backed consortium, which also includes KKR & Co LP (KKR.N), Toshiba has said it is considering a bid led by Bain Capital LP and SK Hynix Inc (000660.KS), and one by Hon Hai Precision Industry Co Ltd (Foxconn) (2317.TW).

Western Digital has offered to drop out of bidding and take a stronger position its joint venture with Toshiba instead, but still wants a stake in the chip business in the future, people familiar with the matter previously told Reuters.

The people also said Toshiba objected to the possibility of Western Digital eventually seeking control of the chip business, and so has sought a limit on any future stake.

(REUTERS)

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