Toshiba Receives High Bids On Its Chip Business

  • Sharnita Sanders
  • February 10, 2017
  • 0

The Japanese corporation, Toshiba, has been looking to raise around 300 billion yen from the sale of 19.9 percent stake toward its flash memory chip business. So far, Toshiba has only received bids of 200 million yen to 400 million yen ($1.8-3.6 billion) according to Reuters.

The price of 300 million would aid in the company’s offset of a multi-billion dollar writedown regarding its U.S. nuclear power business. The company’s U.S. nuclear power company has the potential to get rid of shareholder equity, which is the main concern for investors.

When it comes to bids, Toshiba has a few potential suitors for its chip which include its rival companies SK Hynix Inc and Micron Technology. Toshiba might be on the lookout for bids from many investment funds. That would allow for the company to follow through with the deal faster than if it would accept bids from peers who many have to ask permission from competitors before following through with the acquisition.

When questioned about the deal, one executive for Toshiba stated that the company will not only consider offer prices but other circumstances involving. Another spokesperson for the company said that Toshiba would not make any comments on the process it would be using to determine the sale to the bidder.

On Thursday, shares for Toshiba fell in Tokyo by 6.7 percent. That drop in shares came not too long after Mizuho Securities made it known that it was possible the type of impact Toshiba’s demotion to the second section of the stock exchange in Tokyo would have.

When the company reports its earnings, on February 14th, it also says it will disclose its writedown of its U.S. nuclear business. That number is estimated by sources to be around 700 million yen. It is also believed that Toshiba could possibly withhold on reporting its third quarter earnings but there’s no certainty of this will even occur.

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Sharnita is a nerd at heart with a love of all things geeky. She also has this odd obsession with collecting books of all genre, ranging from contemporary to manga. When not writing, she can be found surfing the web and battling her online shopping addiction.