Toshiba’s US atomic unit to file for bankruptcy

TOKYO: Toshiba’s loss-hit US nuclear unit could be placed under bankruptcy protection as early as this week, a report said yesterday, sending shares in the Japanese giant lower.

Westinghouse Electric is likely to file for Chapter 11 on Tuesday and is eyeing Korea Electric Power Co to help with its subsequent restructuring, Japan’s Nikkei business daily said, without citing sources.

The two firms already have a technology partnership.

Toshiba’s stock ended a see-saw session at 218.4 yen, down 2.06 per cent.

The company has lost more than half its market value since late December, when it warned of multi-billion-dollar losses at Westinghouse and said it was investigating claims of accounting fraud by senior executives at the division.

A Tokyo-based Toshiba spokesman declined to comment on Monday’s Nikkei report.

“The fluctuations today are linked to the recent volatility in Toshiba shares,” Toshikazu Horiuchi, a broker at IwaiCosmo Securities, told AFP.

“There will likely be more selling if US authorities criticise the bankruptcy restructuring.”

Toshiba has said it would try to sell Westinghouse, once lauded as the future of its atomic business after the 2011 Fukushima disaster sidelined new orders in Japan.

Japanese financial regulators have given the company until April 11 to publish results for the October-December quarter, which were originally due in midFebruary.

Toshiba has twice delayed their release, saying it needed more time to probe claims of misconduct by senior managers at Westinghouse and gauge the impact on its finances.

Toshiba previously warned it was on track to report a net loss of 390 billion yen (US$3.5 billion) in the fiscal year to March, as it faced a writedown topping 700 billion yen at Westinghouse, which has been hit by big cost overruns.

This month Standard & Poor’s cut its credit rating on Toshiba again, warning that its finances were quickly worsening.

The firm is trying to spin off its prized memory chip business to raise cash, after earlier selling its medical devices unit and most of a home appliance business.

The latest crisis comes less than two years after Toshiba’s reputation was badly damaged by separate revelations that top executives had pressured underlings to cover up weak results for years after the 2008 global financial meltdown. — AFP