California court's postponement puts Toshiba in further limbo
Troubled company ordered not to sell prized memory unit for a week
TOKYO -- A California court has postponed judgment on Western Digital's request to stop partner Toshiba's sale of its memory chip business, leaving the Japanese company's plan in limbo.
A judge had been expected to issue a ruling in the case on Friday, with some prognosticators saying the San Francisco County Superior Court would block Toshiba's plan to sell the prized unit to its favored suitor, a consortium led by the public-private Innovation Network Corp. of Japan as well as Japanese, U.S. and South Korean companies.
With the postponement, to next Friday, Toshiba has at least avoided the worst-case scenario of having negotiations halted; it can continue talks with buyers. Still, the court ordered Toshiba not to complete any sale until Friday.
This is a blow to the hobbled Toshiba, which had wanted to complete the sale of Toshiba Memory in May.
Toshiba selected the consortium as the favored buyer in late June and is still hammering out details.
But the fate of Toshiba Memory is by no means clear. This month, Toshiba reopened negotiations with two other groups wanting to buy the unit. One of these groups includes Western Digital, the other includes Hon Hai Precision Industry.
In addition, Toshiba and Western Digital are facing off in an international arbitration tribunal over the same issue.