Toshiba accepts $15 billion buyout offer from private equity group
What happened now? Toshiba has accepted a buyout offer from a consortium led by Japan Industrial Partners (JIP) that would take the Japanese tech giant private. The deal, approved by Toshiba’s board of directors on Thursday, is valued at 2 trillion yen (about $15.3 billion) or 4,620 yen ($35.43) per share and represents a 9.7 percent premium over Thursday’s closing price. at 4213 yen.
Toshiba has a storied history that dates back to the late 1800s. The company has successfully established itself as a global electronics giant for many years, but since being rocked by a major accounting scandal in 2015, the company has struggled.
The Japanese tech giant has taken several steps in an attempt to remedy the situation, including cutting nearly 8,000 jobs and selling several divisions. Toshiba sold its image sensor division to Sony, transferred its television business to Hisense, parted ways with its memory chip business, and officially exited the PC market.
This was reported by sources familiar with the situation. Reuters that about 20 Japanese companies, including Chubu Electric Power and chip maker Rohm Co., plan to take part in the buyout. If completed successfully, the deal will be the third largest M&A in the world this year, according to Refinitiv.
Toshiba’s share price has fallen more than 11 percent over the past year, but is up about 4.2 percent at the time of this writing.
JIP bet was the only complete bid received during Toshiba’s year-long competitive auction. Toshiba put forward eight proposals in the first wave, along with two capital pool proposals, but only four proposals made it to the second round, according to sources.
Analyst Travis Lundy of Quiddity Advisors told Reuters that the deal ends months of uncertainty over whether the deal went through. The price may be disappointing, Lundy said, but at least it’s an exit for active investors.
We have been informed that JIP is due to submit a bid at the end of July.
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