Japanese tech giant Toshiba accepts $15B tender offer

Japanese electronics and technology manufacturer Toshiba has accepted a 2 trillion yen ($15 billion) tender offer from a buyout fund made up of the nation’s major banks and companies.

Japan Industrial Partners was created in 2002 to restructure Japanese companies. Companies it has invested in include Sony, Hitachi, Olympus and NEC.

Toshiba announced its board accepted the bid at 4,620 yen ($36) a share late Thursday. Toshiba closed at 4,213 yen ($32) a share and is trading at 4,474 yen ($34) early Friday. 

The bid is the latest chapter in the company’s turnaround effort, allowing it to go private and delist from the Tokyo Stock Exchange. 

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Overseas activist investors own a significant part of Toshiba’s shares, and it’s unclear if they will be happy with the latest bid.

If the deal is successful, it will keep Toshiba’s business Japanese in an alliance with Japanese partners.

The consortium includes about 20 Japanese companies, such as Orix Corp., a financial services company, electronics manufacturer Rohm Co. and the megabanks such as Sumitomo Mitsui Banking Corp., according to Japanese media reports.

Toshiba has been dealing with controversy for years, starting with an accounting scandal in 2005.

Its U.S. nuclear arm Westinghouse, filed for bankruptcy in 2017 after years of deep losses as safety costs soared. 

TOSHIBA NOW PLANS TO SPLIT INTO TWO, BOOSTS SHAREHOLDER RETURN TARGETS

Toshiba is also involved in the decommissioning effort at the Fukushima nuclear plant, heavily damaged by an earthquake and tsunami in March 2011.

Toshiba has gone through several presidents over the years.

The latest proposal still needs to go through regulatory reviews in several countries, including the U.S., Vietnam, Germany and Morocco. 

That process is expected to take several months.

TOSHIBA GETS TAKEOVER BID FROM PRIVATE EQUITY FIRM CVC

Toshiba has been trying to go private in recent years. Proposals to split Toshiba into three and then two companies were rejected by shareholders.

The company first received a buyout offer from private equity firm CVC Capital Partners in April 2021, which was subsequently dismissed as lacking details.

Interest in Toshiba by Japan Industrial Partners was first reported last October.

Last month, Toshiba lowered its profit forecast for the fiscal year to 130 billion yen ($1 billion), down from an earlier projection for a 190 billion yen ($1.5 billion) profit.

The Associated Press contributed to this report.