Toshiba Pares Losses on Report of Apple Investing in ChipsBy
Toshiba Corp. shares recovered after Japan’s national broadcaster reported that Apple Inc. is considering an investment of several billion dollars in its semiconductor unit, raising the prospect that the struggling electronics conglomerate will get a much-needed cash infusion.
Toshiba has put its memory chips business up for sale to make up for a writedown of 716.6 billion yen ($6.56 billion) in its U.S. nuclear equipment operations. One option being considered is an investment accompanied by Toshiba holding shares, so that a majority of the semiconductor unit will be held by U.S. and Japanese interests, satisfying the respective governments, NHK said.
Yukihito Uchida, a spokesman for Toshiba, declined to comment on Apple’s involvement and the NHK article.
Toshiba shares were down 4.8 percent at 1:56 p.m. in Tokyo, after declining as much as 8.1 percent during morning trade. The stock is down about 29 percent this year.
While Toshiba has been narrowing the field of interested buyers, there are also signs the process is being put on hold after joint-venture partner Western Digital Corp. warned a sale may violate a contract it has with Toshiba. An Apple bid would add another layer of complexity, given its large cash position and influence as the maker of iPhones. Toshiba’s memory chips are used in smartphones, personal computers and data centers, putting them at the heart of a shift away from hard disk drives.
Toshiba has narrowed the original group of contenders for the chip business after a first round of bidding. Taiwan’s Hon Hai Precision Industry Co. has indicated its willingness to pay as much as 3 trillion yen for the unit, Bloomberg has reported.
Hon Hai could take a stake of about 30 percent stake and have parties including Apple and Japanese companies also invest in the chip company, in order to address Japanese government concerns about loss of technology overseas, NHK reported. Hon Hai has asked SoftBank Group Corp. for help with its bid for the chips business, the Nikkei reported Friday.
The Yomiuri newspaper said last month that Apple was among the bidders for the chips unit.
— With assistance by Yuji Nakamura