Sorry Apple, You cannot buy Toshiba’s Chip-Unit
SHARE
, / 474 0

Toshiba is on the brink of financial collapse and needs buyer of its chipmaking business to come out of it. The Japanese conglomerate announced on Wednesday that a consortium of the government-backed Innovation Network Corporation of Japan Fund, Bain Capital and US private equity group, and SK Hynix of South Korea, as the preferred bidder of its flash memory business.

“Toshiba has determined that the consortium has presented the best proposal, not only in terms of valuation, but also with respect to certain of closing, retention of employees, and maintenance of sensitive technology within Japan,” Toshiba said in a statement.

toshiba-chip

A formal decision will be made by next Wednesday when Toshiba holds its annual shareholders meeting.

The consortium, which bid ¥2 trillion, was selected among Hon Hai Precision Industry, a Taiwan-based electronics assembly giant. Apparently, Hon Hai had bid a staggering amount of ¥3 trillion. Among overseas firms eyeing on Toshiba’s chipmaking business was the Foxconn Apple Amazon tie-up.

Industry minister Hiroshige Seko welcomed the electronics maker’s decision to let it chipmaking business go on sale. The sale will protect Toshiba’s technology from going overseas, promote innovation, and retain workers. So, now you know why Foxconn Apple Amazon were not the preferred buyers.

A formal decision will be made by next Wednesday when Toshiba holds its annual shareholders meeting.

Toshiba is the world’s second-largest flash memory market presently. It desperately needs enough funds to get rid of the ¥540 billion debt it derived from Westinghouse Electric Co., its nuclear unit. It will be delisted from the Tokyo Stock Exchange if by the end of this fiscal year it fails to clear the negative net worth.

Not so long ago, it revealed unaudited fiscal 2016 results and reported that its net loss has peaked ¥950 billion due to the crisis at Westinghouse. Two years ago, Toshiba also acknowledged that it had been falsifying its book since 2008 as managers desperately tried to meet overly ambitious targets. An investigation led by an outside body revealed the profits had been inflated and expenses were hidden.

Author
Follow Anna Domanska on Twitter, Facebook & Google.

Register today to get full access to:

All articles | Magazine archives | Livestream events | Comments

PASSWORD RESET

Register today to get full access to:

All articles | Magazine archives | Livestream events | Comments

LOGIN