Vulture funds circle for piece of Toshiba's chip business
Canon, Western Digital also wait in wings for conglomerate's spinoff
TOKYO -- Four foreign investment funds have reportedly offered to take a stake in Toshiba's memory chip operations should the Japanese electronics giant spin off the business.
U.S. firms Silver Lake, Bain Capital and Kohlberg Kravis Roberts, as well as Permira of the U.K., have signed nondisclosure agreements and are preparing bids. Japanese banks, such as Mizuho Bank, Sumitomo Mitsui Banking Corp. and the Development Bank of Japan, are also considering entering the fray via their investment funds.
The investment opportunity also has drawn interest from companies outside the finance industry, such as Canon, American hard-drive maker Western Digital and Chinese chipmaker Tsinghua Unigroup. All told, the list of candidates considering bidding has grown to around 10.
Faced with massive losses on U.S. nuclear operations, Toshiba intends to spin off its flash memory business and sell a 20-30% stake in the freshly minted unit, potentially for 200 billion yen to 300 billion yen ($1.74 billion to $2.61 billion). Though more shares could be sold, Toshiba plans to keep the business a consolidated subsidiary.