Down but not out, Toshiba's chief strikes resolute tone
Struggling group stands firm on Western Digital, tamps down bankruptcy talk
TOKYO -- Toshiba is not violating a joint-venture agreement with Western Digital by moving to sell memory chip operations, President Satoshi Tsunakawa maintains, even with the American business partner demanding arbitration. Filing for bankruptcy is not on the table, either.
Tsunakawa discussed Toshiba's finances and future Monday in a news conference at company headquarters here. Excerpts from the session follow.
Q: Can you elaborate on not being able to release audited full-year figures?
A: We take seriously the fact that we have generated heavy losses. I cannot provide details on the book settlement process, but our stance is that we will cooperate with the auditors, and we are not inhibiting them in any way. We are cooperating fully.
Q: How would you describe your relationship with the auditing firm?
A: We are having constructive discussions with our auditing firm toward advancing the book settlement process. There are no divisions in particular to speak of, and both sides are working together to give our stakeholders peace of mind.
Q: When do you expect to submit an audited financial statement?
A: We wish to work with our auditing firm to make sure we submit it by the statutory deadline.
Q: So there is a chance you won't make it by the end of June?
A: We wish to coordinate to make sure that doesn't happen. We do not plan to [prematurely terminate the audit].
Q: Are there any plans to change auditors?
A: For fiscal 2016, we are coordinating with PricewaterhouseCoopers Aarata. What comes after that will be decided by our audit committee. At this stage, I have not heard of a decision having been made.
Q: Will you be able to fulfill requirements to remain listed?
A: That is for the Tokyo Stock Exchange to decide. We are fully cooperating toward that process. We do not believe [Toshiba will get delisted].
Q: Is there a chance Toshiba will enter into legal insolvency proceedings?
A: We are not considering that. We will work toward restoring the damaged financial base.
Q: What do you say about your business partner Western Digital initiating arbitration proceedings to halt the sale of the memory business?
A: What we are doing is transferring majority ownership through formal processes. It is our understanding that there is no conflict with the [Western Digital] agreement. We will communicate to the bidders the legitimacy of our argument to eliminate their concerns. We will end the [current round of] bidding as scheduled [on the 19th].
Q: Haven't Toshiba and WD agreed to work toward a solution?
A: I have met with WD CEO Steve Milligan, and discussions have not broken down. We will continue to discuss the issue. [The time frame for a resolution] is still unknown, but I hope it is as soon as possible.
Q: What will happen if you're unable to close the sale of the memory unit this fiscal year?
A: Our company's plan right now is to explain the legitimacy of our position. We would like to think about [other plans], but nothing has been decided at this point.
Q: Will you be staying on as president?
A: I feel responsible, but I am entrusting my future at this company with the nominations committee. Right now, I wish to endeavor to take control of the situation.