TOKYO (AP) — Toshiba announced a 2 trillion yen ($14 billion) bid on Monday in a move that would take it private as the scandal-ridden Japanese electronics and energy giant seeks to turn itself around.
The takeover bid led by a buyout fund of major Japanese banks and companies called Japan Industrial Partners begins Tuesday and costs 4,620 yen ($32) per share.
Chairman Akihiro Watanabe asked shareholders to support the proposal, saying it is the only option for Toshiba Corp. to return to its former strength.
“This step for Toshiba is great, not only for Japan, but also for the world,” he said. “I’m confident in Toshiba’s resurgence.”
Tokyo-based Toshiba also reported a loss of 25 billion yen ($176 million) for the April-June quarter on revenues of 704 billion yen ($5 billion), down nearly 5% from the previous year.
It did not give a full profit forecast for the fiscal year, citing uncertainties in its computer chip business.
If successful, the proposal will mark a major step in Toshiba’s long-standing effort to delist the company from the Tokyo Stock Exchange.
At least two-thirds of the shareholders must offer their stake for the bid to succeed. Foreign activist investors own a significant number of Toshiba shares, and some have expressed displeasure with the offer.
The Toshiba board accepted the deal in March.
Toshiba closed Monday at 4,584 yen ($32) per share.
The acquisition would keep Toshiba in an alliance with Japanese partners. Founded in 2002 to restructure Japanese companies, Japan Industrial Partners has also invested in other Japanese brands such as Sony, Hitachi and Olympus.
Toshiba, a major manufacturer in Japan’s nuclear industry, was hit by the March 2011 tsunami that collapsed three reactors at Fukushima in northeastern Japan.
Toshiba is involved in the decommissioning of Fukushima Dai-ichi, which is expected to take decades. The US nuclear arm Westinghouse filed for bankruptcy in 2017 after years of heavy losses while safety costs skyrocketed.
The Toshiba brand, once prized for home appliances, laptops, batteries and computer chips, became the target of foreign activist shareholders.
The company’s image was also badly tarnished by a massive accounting scandal in 2015 involving books that had been manipulated for years.
Toshiba stressed that the latest offer was “reasonable and fair” and made sense to management, with companies that had a long-standing deep business relationship with Toshiba offering to invest.
Chief Executive Taro Shimada said it would bring stability to Toshiba, which he believes will celebrate its 150th anniversary in a few years.
He implored stakeholders to support the bid.
“The value of our company comes from creating what didn’t exist in the world before,” he told reporters.
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Yuri Kageyama is on Twitter https://twitter.com/yurikageyama
