Agreement to sell Toshiba’s memory-chip business may be delayed

TOSHIBA’S announcement of a final agreement to sell its memory-chip business might be delayed beyond the electronics maker’s self-imposed deadline this week, as Bain Capital and Japanese investors work out the structure of the deal, people with knowledge of the matter said yesterday.

When announcing the preferred bidders last week, Toshiba said that it planned to reach an agreement by tomorrow and close the transaction by March next year.

The Innovation Network Corporation of Japan (INCJ) and the Development Bank of Japan (DBJ), which joined Bain Capital, are not in a hurry to reach a final agreement as they conduct due diligence, because their participation will not require a lengthy antitrust review process, said one of the people, who asked not to be identified, because the negotiations are private.

Another person said the outline of the deal may change, depending on what happens with Western Digital, which jointly owns certain chip assets with Toshiba and has contested its authority to sell the semiconductor unit.

Kaori Hiraki, a spokesperson for Toshiba, said there was no change in the schedule.

Satoshi Tsunakawa, Toshiba’s president, said on Friday that the company was on track to reach a final agreement on the sale.

Bain, the INCJ and the DBJ have indicated that they’re willing to pay ¥2.1 trillion (R244 billion) for the semiconductor unit, people with knowledge of the matter have said.

The divestment brings muchneeded cash into Toshiba, which is seeking to make up for losses in its nuclear operations.

The support of two statebacked entities was considered crucial to win government approval for a deal.