TOKYO – A shareholder meeting of Japanese tech company Toshiba approved on Tuesday the sale of its memory chip unit to an international consortium led by American investment fund Bain Capital.
In an extraordinary meeting held in Chiba in northeastern Tokyo, shareholders ratified the decision taken a month ago by the company’s board. The sale is intended to help the company overcome its financial problems.
Toshiba said in a statement that approval of the Share Purchase Agreement was an important step, adding that both parties were working to complete the final transaction by March 2018.
The consortium chosen by Toshiba is led by the United States investment fund Bain Capital and also includes South Korean chip maker SK Hynix, the Development Bank of Japan, Japanese public-private fund Innovation Network and US tech giants Apple and Dell.
The group had made an offer of around 2 trillion yen ($17.9 billion), and both sides now need to close the final terms of the deal and get the approval of competition authorities in the relevant markets.
The sale of Toshiba’s NAND flash memory unit, which has the second largest share in the global market after South Korea’s Samsung Electronics, has been stuck due to litigation between the Japanese company and Western Digital, its partner in the business which had also expressed interest in the purchase.
The spin-off of the profitable chip unit is aimed at obtaining liquidity for Toshiba and compensating for the losses stemming from its debt-ridden US-based nuclear-energy business.
The Japanese tech giant ended the last fiscal year with massive losses mainly due to the financial problems of its US-based nuclear power company, Westinghouse Electric, which declared bankruptcy in March.