KKR in talks with Toshiba on preemptive bid for chips unit
TOKYO: KKR & Co is in talks with Toshiba Corp about a preemptive bid for the Japanese company’s memory chips business that would accelerate completion of sale and end negotiations with other potential acquirers, according to people familiar with the matter.
Toshiba was in favour of the proposal from KKR and Innovation Network Corp of Japan because it would simplify regulatory approval and speed up the delivery of much-needed cash, said the people.
KKR and its partners, which also include Development Bank of Japan Inc, have indicated they would pay 1.8 trillion yen (RM70.4 billion) to 2.1 trillion yen, said one of the people.
Western Digital Corp chief executive officer Steve Milligan planned a trip to Japan this week to discuss joining the group, said another person.
Toshiba hadn’t definitively decided whether to accept the KKR offer and might still proceed with the auction, said the people.
Rival bidders for the business include Taiwan’s Hon Hai Precision Industry Co and South Korea’s SK Hynix Inc and Broadcom Ltd.
The company was selling off assets to plug a hole in its balance sheet after enormous losses in its Westinghouse nuclear unit.
The semiconductor business, which makes memory chips for mobile phones and other devices, was the most valuable asset.
Toshiba aims to complete the sale by March next year.
The company’s stock has lost half its value since December when it warned of multibilliondollar losses in the nuclear unit.
It also faces the potential delisting of its shares from the Tokyo Stock Exchange. Bloomberg
KKR and partners may pay 1.8 to 2.1 trillion yen for the stake in Toshiba’s chip unit.