Western Digital-led group wins bid for Toshiba chip unit: Nikkan Kogyo


"The dramatic twist in the sale process, beset by legal wrangling and revised bids, comes just a day before Toshiba's latest deadline".

Toshiba Corp. has once again chose to hold off on making a decision on the buyer of its chip unit at a board meeting as negotiations with a Western Digital Corp. -led group have stalled, sources close to the matter said Tuesday. Nikkan Kogyo said the two companies are in the final stages of talks to work out how big a stake Western Digital will eventually have in the chip unit.

Toshiba President Satoshi Tsunakawa told the conglomerate's main creditors Tuesday that the company is now also considering selling Toshiba Memory to the Japan-U.S.

A Western Digital spokeswoman also declined to comment.

Toshiba's originally preferred bidders were funds backed by the Japanese government, SK Hynix and USA private equity firm Bain Capital LP.

In related news, CFO Mark P. Long sold 1,517 shares of the stock in a transaction that occurred on Monday, August 14th.

Other members of group, which is offering 1.9 trillion yen ($17.4 billion), will include the Innovation Network Corp of Japan and the Development Bank of Japan as well as KKR, with each putting up 300 billion yen, they said.

But those talks hit snags as Toshiba, fearing that Western Digital was angling to eventually take over the chip business, sought to control the USA firm's stake in return for a better position in their current chipmaking joint venture, the sources said.

The Bain-led group had been chosen preferred bidder in June.

Western Digital, which jointly invests in Toshiba's key chip plant, has been at loggerheads with its partner over the auction of the key chip business.

Some media are also reporting that Bain Capital-backed consortium has upped its offer in the matter to $22.3 billion. Earlier this evening in Japan, news of what could be announced officially in the days to come is that the Bain bid with SK Hynix and Apple is going to be the victor for Toshiba's chip business. Apple apparently said it worries about pricing.