Toshiba Memory sale: Plan B?

January 22, 2018

Reports imply that the OEM’s executives are making preparations in case the unit sale collapses.

Toshiba is putting in place a contingency plan should the long-mooted sale of its memory chip business to Bain Capital fall through, according to the Financial Times, (as reported by CNBC).

The $18 billion (€14.7 billion) sale, arranged to cover billions of dollars in liabilities after the OEM’s nuclear power subsidiary Westinghouse went bankrupt, must gain antitrust approval before the end of March if it is to proceed.

According to sources, one ‘Plan B’ being considered by Toshiba executives is an IPO (initial public offering) – floating the company on the stock exchange and turning Toshiba Memory into a public company, from a privately held one.

Yet the Japanese OEM is no longer under such intense pressure to complete a sale at all, having raised ¥600 billion ($5.4 billion/€4.4 billion) late last year with a new share issue, thereby sufficiently covering its liabilities. One investor, Hong Kong-based Argyle Street Management, said a sale was no longer necessary, although a company spokesperson insisted there had been no change to Toshiba’s plans, and still hopes to complete the sale of the chip unit to the Bain Capital-led consortium.

Toshiba recently found a buyer for its defunct nuclear plant, with a deal being announced this month with Canadian investment firm Brookfield Business Partners.