Toshiba has confirmed that it is to spin off its memory business with a chunk to be purchased by an as-yet unnamed buyer believed to be storage giant Western Digital.
Not that long ago, Toshiba was investing heavily in the solid-state storage market: When OCZ filed for bankruptcy in 2013
, Toshiba purchased the company for $35 million
before relaunching the brand as OCZ Storage Solutions
in early 2014. Despite reasonable commercial success for both OCZ and Toshiba-branded drives, plus technological breakthroughs courtesy of its partnership with SanDisk
, things haven't been going smoothly since. In 2015 executives abandoned the company
in the face of an accounting scandal which led to a $39.5 million fine
from the Japanese Securities and Exchange Surveillance Commission, while an attempt at breaking into the North American nuclear power market last year has ended in a major loss.
The result: The rumour that Toshiba was to spin off its semiconductor arm
with Western Digital tipped as taking a slice in order to improve Toshiba's cash flow. While Toshiba confirmed at the time that it was investigating a spin-off, it said nothing had been decided; today, though, that decision has been made and a spin-off is indeed in the works.
In a statement
(PDF warning), Toshiba confirmed that it would be spinning off its memory division - including the solid-state storage arm, but keeping its image sensor business in-house, and that 'the Company [Toshiba] is considering an injection of third-party capital as a financial measure
.' That injection would come as a sale of a chunk of the newly formed company, with Western Digital - which has remained silent on its involvement - seeming favourite to take the slice.
Toshiba has called for an extraordinary meeting of shareholders to discuss the plan, with a view to beginning the spin-off process by the end of March.