[Global Network Technology Reporter Chen Jian] According to Bloomberg News, Toshiba has announced plans to issue new shares worth 600 billion yen in an effort to avoid delisting from the Tokyo Stock Exchange. The company also revealed its intention to sell assets of Westinghouse Electric, a subsidiary involved in nuclear power, which is currently under bankruptcy protection. This move comes as Toshiba faces mounting financial pressures due to ongoing accounting scandals and significant losses from its nuclear division.
The sale of Westinghouse’s shares and rights is expected to help Toshiba reduce costs and redirect capital toward emerging business opportunities. However, Westinghouse has been struggling with massive losses, estimated at several billion U.S. dollars. Despite securing contracts for two nuclear projects in the U.S., the company has faced major delays and budget overruns, leading to widespread speculation about Toshiba’s decision to divest its nuclear unit.
Toshiba has been under pressure to stabilize its financial position, especially after losing key businesses and facing regulatory scrutiny. The company has already begun the process of selling its chip business to alleviate its financial burden. However, the deal may face delays, as it requires approval from multiple regulatory bodies across different countries.
After a lengthy auction process, Toshiba recently agreed to sell its memory chip unit to a consortium led by Bain Capital. This move aims to raise funds to cover the financial gap caused by its troubled nuclear operations. However, complications have arisen because Western Digital, a joint venture partner of Toshiba, has filed an arbitration claim, arguing that the sale of the chip unit must be approved by them. Western Digital claims it holds certain legal rights that could block the transaction, as the sale is part of ongoing negotiations regarding their chip joint venture. Despite this, there are reports suggesting that an agreement might be reached by the end of the month.
Meanwhile, Toshiba is not waiting for the chip sale to proceed. Private equity firms such as Blackstone Group and Apollo Global Management have shown interest in acquiring Westinghouse Electric, with other companies also considering bids.
In addition, Toshiba expects to raise $5.3 billion through the issuance of new shares. It anticipates that its net assets will reach 750 billion yen by next year. To support this, overseas investors, including Singapore-based Effissimo Capital Management, are reportedly planning to subscribe to the new shares. These developments highlight the company's urgent need to stabilize its financial position and regain investor confidence.
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