Toshiba shareholders approve $18b TMC sale to Bain consortium

TMC will be transferred to a special purpose vehicle controlled by the consortium, which also includes the Innovation Network Corporation of Japan (INCJ) and Development Bank of Japan (DBJ), along with strategic investors such as Apple, Dell, Kingston, and Seagate. Toshiba will reinvest JPY351 billion in the vehicle.

Toshiba agreed to the sale last month after a protracted sale process complicated by the resistance of Western Digital, whose SanDisk division operates a Nand flash manufacturing plant in Japan as a joint venture with Toshiba. The sale was prompted by Toshiba’s deteriorating financial position after its Westinghouse nuclear power unit filed for bankruptcy earlier this year.

Toshiba and the consortium are trying to close the deal by the end of March 2018, according to a statement. The company needs the revenue from the sale in order to cover the Westinghouse losses and avoid delisting from the Tokyo Stock Exchange.

Toshiba posted revised net sales of JPY4.87 trillion for the year ended March 2017, down from JPY5.15 billion the year before. Over the same period, the company’s net loss widened from JPY460 billion to JPY966 billion due to write-downs associated with Westinghouse. Toshiba had forecast a profit of JPY230 billion for the year ended March 2018 due to proceeds from the TMC sale, but revised that projection in a statement this week to a net loss of JPY110 billion due to tax impact of the sale.

Separately, Bain has warned that Western Digital’s continued attempts to block the sale in US courts could jeopardize the company’s relationship with Toshiba and their joint venture. The consortium had previously said that the partnership would not be affected by the acquisition.

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• Topics
• North Asia
• Technology
• Buyouts
• Japan
• Bain Capital Asia
• Innovation Network Corp. of Japan (INCJ)
• The Development Bank of Japan (DBJ)