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Toshiba and Western Digital bury war hatchets

(Image credit: Image Credit: Toshiba)

It seems as Toshiba and Western Digital have buried their war hatchets and are ready to take on Samsung in the chip industry in 2018.

News came out this Wednesday that both companies have called off their lawyers and have essentially come to an agreement, which will allow them to move on with the chip business next year.

So what happened? Toshiba wanted to sell its chip business to a consortium led by Bain Capital for roughly $18 billion. Western Digital opposed the deal, saying it had a right of refusal. Western Digital had a bid of its own. Under the Bain Capital deal, Toshiba would retain some 40 per cent stake in the unit.

Now that the conflict is out of the way, the two companies will jointly invest in the Japanese chip production and share the profit. If the deal with Bain Capital goes through, Toshiba would reinvest in its chip unit, which is the world's second largest producer of NAND chips, with the parts maker Hoya Corp.  The Japanese government is hoping for this outcome since it would allow national firms to hold more than 50 per cent of the business.

Toshiba's chip unit chief Yasuo Naruke said the company “has the resources it needs to continue to innovate and deliver for a fast-growing flash memory market.”

Toshiba has taken a huge hit after its nuclear unit Westinghouse went bankrupt, and is now looking for a way out.

Image Credit: Toshiba

Sead Fadilpašić is a freelance tech writer and journalist with more than 17 years experience writing technology-focussed news, blogs, whitepapers, reviews, and ebooks. And his work has featured in online media outlets from all over the world, including Al Jazeera Balkans (where he was a Multimedia Journalist), Crypto News, TechRadar Pro, and IT Pro Portal, where he has written news and features for over five years. Sead's experience also includes writing for inbound marketing, where he creates technology-based content for clients from London to Singapore. Sead is a HubSpot-certified content creator.