According to a Financial Times report published earlier on Monday, Toshiba Corp. might consider an initial public offering (IPO) of its highly respected memory chip business, should an agreed £12.99m ($18 billion) sale to a consortium led by Bain Capital not get antitrust approval before the end of March 2018.
Quoting individuals who are familiar with the company’s plans, the Financial Times reported that the IPO is only one of a number of contingency plans considered by top executives at Toshiba. Reportedly some Toshiba shareholders and analysts actually favour this option over the sale.
Last September, Toshiba agreed to sell the 2nd biggest producer of NANO chips on earth, Toshiba Memory, to a consortium under the leadership of Bain to recover liabilities of billions of dollars related to the bankrupt American nuclear power division, Westinghouse Electric Co. LLC.
After managing to raise about $5.4bn by issuing shares to overseas funds late in 2017, the Japanese firm no longer has to feel under such immense pressure – combined with tax write-offs it can meet its liabilities.
Sources say that should the deal not gain regulatory approval before the end of March, Toshiba will be able to walk away.
A spokesperson for the company merely said they were still trying to finalise efforts for the sale of the chip unit.
Argyle Street Management Ltd., a Hong Kong based hedge fund which manages assets worth close to $1.2bn, opposes the sale and wants the board to instead consider an IPO.
Toshiba’s share price reached its highest level in three months earlier, at one stage increasing as much as 4.7%.