TOKYO -- Toshiba intends to ask for an additional 300 billion yen ($2.46 billion) in credit lines from its main lenders by the end of January as plans for a large-scale restructuring threaten to leave the company short on cash.
Chief Financial Officer Masayoshi Hirata discussed the plans in an interview Monday. Toshiba is likely to approach multiple financial institutions including Mizuho Bank and Sumitomo Mitsui Banking Corp.
The troubled Japanese manufacturer is expected to report a record group net loss of 550 billion yen for fiscal 2015 as a result of major restructuring efforts. This includes payroll cuts in the lifestyle segment, of which personal computers and televisions are a part. Toshiba's capital base has shrunk 60% from the end of last fiscal year to 430 billion yen. Its capital ratio, which stood at 17% last fiscal year, has fallen to around 8%.
Though Toshiba had secured 400 billion yen in credit lines at the end of September, it found afterward that restructuring costs had climbed to around 260 billion yen. Roughly 200 billion yen in loans will come due this fiscal year as well. The company decided to borrow the funds needed for restructuring, though this would further swell interest-bearing debt, which totaled about 1.5 trillion yen at the end of September.
Toshiba does not plan to raise capital in a way that would add to outstanding shares, Hirata said.
The company also is negotiating the sale of equipment maker Toshiba Medical Systems, which likely would boost Toshiba's capital base to over 1 trillion yen by the middle of fiscal 2016. And restructuring is expected to trim fixed costs by about 300 billion yen in fiscal 2016 compared with the fiscal 2015 projection. Toshiba aims to restore its capital ratio to at least 30% as soon as possible, Hirata said.