Toshiba’s US atomic unit to file for bankruptcy
Shares in Toshiba plunged Monday on a report that said its loss-hit US nuclear unit could be placed into bankruptcy protection as early as this week. Westinghouse Electric could file for Chapter 11 on Tuesday, while the troubled unit is eyeing Korea Electric Power to help with a subsequent restructuring, Japan’s Nikkei business daily said, without citing sources.
TOKYO — Shares in Toshiba plunged Monday on a report that said its loss-hit US nuclear unit could be placed into bankruptcy protection as early as this week.
Westinghouse Electric could file for Chapter 11 on Tuesday, while the troubled unit is eyeing Korea Electric Power to help with a subsequent restructuring, Japan’s Nikkei business daily said, without citing sources.
The two firms have an existing technology partnership.
Toshiba’s Tokyo-listed stock opened sharply higher Monday, tacking on 4% at the start, but quickly reversed course to end the morning 5.65% down at ¥210.4.
The firm’s market capitalization has halved since late December when the pillar of corporate Japan first warned of multibilliondollar losses at Westinghouse and said it was investigating claims of accounting fraud by senior executives at the division.
A 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 criticize 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 mid-February.
Toshiba 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 has previously warned it was on track to report a net loss of ¥390 billion ($3.5 billion) in the fiscal year to March, as it faced a writedown topping ¥700 billion at Westinghouse.
This month, Standard & Poor’s cut its credit rating on Toshiba again, warning its finances were quickly deteriorating.
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. —