Toshiba has finally received regulatory approval for the sale of its semiconductor arm, Toshiba Memory Corporation, and plans to close the deal by June.
Following some disastrous investments, including an ill-fated US nuclear power venture, Toshiba announced that it would be spinning its semiconductor arm off in January last year. While it would retain its image sensor business, the remainder of its semiconductor technology - in particular its memory business - would be renamed to Toshiba Memory Corporation and an injection of third-party capital sought by selling off a chunk of the new businesses' shares. Sadly, things did not go smoothly: Western Digital, originally tipped as the front-runner to invest in the business, attempted to block the sale using the terms of a joint venture between Toshiba and WD subsidiary SanDisk. When Toshiba picked another bidder, Western Digital sued - while Toshiba, naturally, sued back.
In the months that followed the two companies continued to fight it out, even as Toshiba reached an agreement with a consortium including Bain Capital and SK Hynix and inked said agreement in September 2017. Western Digital would continue to block the deal, but the pair had reached an agreement by mid December - which left Toshiba with the challenge of having the deal approved by regulators.
Now, nearly a year and a half after the company announced its spin-off plan, Toshiba finally has everything it needs: The company has confirmed that 'all required anti-trust approvals have been granted, and that all conditions for the closing of the transaction are now satisfied' - the Chinese government having withdrawn its opposition to the deal.
The acquisition of a chunk of Toshiba Memory Corporation by K.K. Pangea, a special-purpose company formed by the Bain Capital consortium, is expected to close by June 1st 2018 - giving Toshiba its long-awaited cash injection.
October 14 2019 | 14:00