Toshiba to sell chip unit by June

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Toshiba’s memory business will most likely be sold by June, Reuters reported this Friday morning.

Even though initial estimates from Toshiba put the deadline in March, it seems as June is a more realistic date. The $18 billion deal is still waiting on regulatory approval from China, it was said. Reuters says it is ‘widely viewed as unlikely’ that China will offer the regulatory approval by end of the financial year, which is in March.

“We’ve been making various efforts to close the deal in March,” Yasuo Naruke, the head of Toshiba’s chip unit, told reporters on Friday. But if that does not happen, the deal will close “at some point in April, May or June,” Naruke added.

Last year, Toshiba agreed to sell its chip business to Bain Capital-led consortium. The deal was a part of Toshiba’s effort to plug its financial holes that appeared after its nuclear unit failed.

US firm Bain Capital's acquisition is backed by a consortium of domestic and foreign investors, most notably Apple, Seagate and Dell, which will both provide financial support, as well as Toshiba itself, which will reinvest 350.5 billion yen into the new company.

The deal means that Toshiba will remain listed on the Tokyo stock exchange, a position that had been in real danger for the 78-year-old company. Toshiba's chip operation was the second largest in the world, behind Samsung, making it a very attractive proposition for investors.

Image Credit: Toshiba