Tesla names board di­rec­tor to re­place Musk amid con­tro­versy

Toshiba to slash 7,000 jobs, profit pro­jec­tion

The Phnom Penh Post - - BUSINESS -

JA­PAN’S en­gi­neer­ing gi­ant Toshiba an­nounced plans on Thurs­day to slash 7,000 jobs and liq­ui­date a unit build­ing a UK nu­clear power plant, leav­ing its fate in doubt.

Toshiba also ex­pects to scrap or con­sol­i­date some fac­to­ries and re­duce its sub­sidiaries by 25 per cent – an­nounc­ing the with­drawal from a US-based liq­uid nat­u­ral gas busi­ness.

The liq­ui­da­tion of NuGen, a nu­clear sub­sidiary in Bri­tain, could com­pli­cate UK ef­forts to shift away from pol­lut­ing power plants that rely on coal, a num­ber of which are slated to close.

“Af­ter con­sid­er­ing the ad­di­tional costs en­tailed in con­tin­u­ing to op­er­ate NuGen, Toshiba recog­nises that the eco­nom­i­cally ra­tio­nal de­ci­sion is to with­draw from the UK nu­clear power plant con­struc­tion project and has re­solved to take steps to wind up NuGen,” Toshiba said in a state­ment.

The NuGen project in Cum­bria in north­west Eng­land was to com­prise three re­ac­tors and was due to start pro­duc­ing en­ergy from 2025.

Toshiba CEO Nobuaki Ku­ru­matani told re­porters in Tokyo the de­ci­sion was reached af­ter “sin­cere dis­cus­sions” with the British govern­ment.

A spokesman for Bri­tain’s busi­ness min­istry said Toshiba’s de­ci­sion would not side­track the govern­ment’s de­ci­sion to push ahead with nu­clear ex­pan­sion, in­clud­ing at an­other plant at Hink­ley Point.

“This govern­ment re­mains com­mit­ted to new nu­clear through the In­dus­trial Strat­egy Nu­clear Sec­tor Deal as well as con­sent­ing the first new nu­clear power sta­tion in a gen­er­a­tion at Hink­ley Point C,” the spokesman said.

The 7,000 jobs will be cut over five years, many com­ing from early or planned re­tire­ment.

For the year to March next year, the firm said it ex­pected a net profit of 920 bil­lion yen ($8.1 bil­lion), down from an ear­lier pro­jec­tion of 1.07 tril­lion yen.

An­nual op­er­at­ing profit out­look is now 60 bil­lion yen, down from a pre­vi­ous 70 bil­lion yen fore­cast, while the sales es­ti­mates were kept at 3.6 tril­lion yen.

Still, the firm’s share price soared, clos­ing up more than 12 per cent on the Tokyo stock ex­change, mainly due to the an­nounce­ment of a share buy­back pro­gramme.

To stay afloat, the cash­strapped group sold its lu­cra­tive chip busi­ness for $21 bil­lion to K K Pangea, a spe­cial-pur­pose com­pany con­trolled by a con­sor­tium led by US in­vestor Bain Cap­i­tal.

ELEC­TRIC car pi­o­neer Tesla on Thurs­day named an Aus­tralian tele­coms ex­ec­u­tive to chair its board of di­rec­tors, af­ter the con­tro­ver­sial Elon Musk was forced by US au­thor­i­ties to step back from the role.

The ap­point­ment of Robyn Den­holm, chief fi­nan­cial of­fi­cer with Tel­stra and al­ready a Tesla board mem­ber, is ef­fec­tive im­me­di­ately but she will serve out her six-month no­tice pe­riod with the Aus­tralian com­pany, Tesla said in a state­ment.

Musk had to re­sign as Tesla chair­man un­der a Septem­ber ar­range­ment with US reg­u­la­tors to set­tle fraud charges stem­ming from a tweet in which he said he planned to take the firm pri­vate and had fi­nanc­ing to do it.

Un­der that set­tle­ment he and Tesla each had to pay a $20 mil­lion fine but Musk was al­lowed to stay on as chief ex­ec­u­tive.

He will help ease the 55-year-old Den­holm’s tran­si­tion, Tesla said.

“To en­sure a smooth tran­si­tion dur­ing the re­main­der of Robyn’s time at Tel­stra, Elon will be a re­source to her and pro­vide any sup­port that she re­quests in her role as chair,” the elec­tric car maker said.

Musk praised Den­holm’s in­put in her time on Tesla’s board.

“Robyn has ex­ten­sive ex­pe­ri­ence in both the tech and auto in­dus­tries, and she has made sig­nif­i­cant con­tri­bu­tions as a Tesla board mem­ber over the past four years in help­ing us be­come a prof­itable com­pany,” he said in the Tesla state­ment.

“I look for­ward to work­ing even more closely with Robyn as we con­tinue ac­cel­er­at­ing the ad­vent of sus­tain­able en­ergy,” Musk added.

Den­holm said: “I be­lieve i n t his com­pany, I be­lieve in its mis­sion and I look for ward to help­ing Elon and the Tesla team achieve sus­tain­able prof­itabilit y and drive long-term share­holder va lue.”

Musk was forced to re­sign as chair­man af­ter the US Se­cu­ri­ties and Ex­change Com­mis­sion charged him with se­cu­ri­ties fraud, al­leg­ing that he mis­led in­vestors when he tweeted on Au­gust 7 that he had “fund­ing se­cured” to delist Tesla at $420 a share, a sub­stan­tial pre­mium over its share price at the time.

‘Sub­ject of con­tro­versy’

The tweet was one of a num­ber of is­sues that raised ques­tions about the bil­lion­aire en­tre­pre­neur’s apt­ness to lead Tesla.

Days af­ter settling with the SEC, Musk mocked the agency, in an­other tweet that la­belled the agency the “Short­seller En­rich­ment Com­mis­sion”.

That al­luded to short­sellers, in­vestors who have bet that Tesla shares will fall and who are fre­quently the sub­ject of Musk’s de­ri­sion.

The ty­coon was the sub­ject of con­tro­versy when he smoked a joint dur­ing a Septem­ber pod­cast in­ter­view in Cal­i­for­nia and dis­cussed the end of the uni­verse.

Den­holm has been chief fi­nan­cial of­fi­cer and head of strat­egy at Tel­stra, Aus­tralia’s for­mer tele­phone mo­nop­oly, since the start of Oc­to­ber.

For 18 months prior to that she was Tel­stra’s chief oper­a­tions of­fi­cer, and pre­vi­ously held se­nior roles at net­work­ing equip­ment com­pany Ju­niper Net­works.

Tel­stra chief ex­ec­u­tive Andy Penn said: “We are sorry to see Robyn leave Tel­stra. We know that it has be­come in­creas­ingly dif­fi­cult to bal­ance her re­spon­si­bil­i­ties as Tel­stra CFO with the in­creased ac­tiv­ity of the Tesla board.”

In pre­mar­ket trade on the Nas­daq ex­change on Thurs­day, Tesla’s share price was up 0.24 per cent at $349.00.

On Oc­to­ber 24, Tesla re­ported a “his­toric” prof­itable quar­ter driven by de­mand for its Model 3 car aimed at the mass mar­ket. But the com­pany re­mains bur­dened by bil­lions in debt.

MARIO TAMA/GETTY IM­AGES/AFP

Elon Musk speaks at a press con­fer­ence at SpaceX head­quar­ters where he an­nounced the Ja­panese bil­lion­aire cho­sen by the com­pany to fly around the moon, on Septem­ber 17 in Hawthorne, Cal­i­for­nia.

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