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Toshiba Sees Long Odds for Hon Hai's $27 Billion Chip Bid

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Toshiba Warns Investors of Its Future

Toshiba Corp. may forgo the highest bid for its semiconductor business, from Hon Hai Precision Industry Co., because of likely opposition from the Japanese and American governments, according to people familiar with the matter.

Taiwan’s Hon Hai, which has indicated its willingness to pay as much as 3 trillion yen ($27 billion) for the chip unit, would face resistance because of its ties to China, said the people, asking not to be identified because the matter is private. That could drag out regulatory approvals and delay badly needed cash payments to Toshiba, raising the risks of such a deal, the people said. Hon Hai, the primary iPhone assembler for Apple Inc., has most of its factories in mainland China.