Toshiba to sell shares, and perhaps Westinghouse, to raise €4.5bn

Japanese company under pressure to raise money or be delisted in Tokyo

Toshiba share sale: the company hopes to erase a €5.7 billion liability. Photograph: Tomohiro Ohsumi/Bloomberg

Toshiba share sale: the company hopes to erase a €5.7 billion liability. Photograph: Tomohiro Ohsumi/Bloomberg

 

Toshiba plans to sell shares to raise 600 billion yen, or about €4.5 billion, and will explore selling its Westinghouse-related assets in a bid to avoid being removed from Tokyo Stock Exchange.

Selling its holding in and claims against Westinghouse, a nuclear-power business that filed for Chapter 11 bankruptcy in the United States in March this year, will let Toshiba “significantly reduce” resources required to rehabilitate the unit and focus them instead on new businesses, the company said on Sunday.

With the cash from a successful share sale Toshiba expects to erase the consolidated negative 750 billion yen, or negative €5.7 billion, on its balance sheet by the end of the fiscal year, in March.

Overseas firms, including Effissimo Capital Management PTE, are planning to make investments, it said.

The Japanese company is clawing its way back after an accounting scandal in 2015 that was followed by a multibillion-euro loss in its nuclear operations in the United States. Toshiba has been under pressure to raise money, or see its shares delisted. The company is in the process of selling its chip unit to raise funds, but it feared the deal wouldn’t be completed by the end of March, as it needs to clear competition laws in different countries.

Toshiba is selling its memory-chip unit to a consortium led by Bain Capital. The sale has been complicated by legal action from Western Digital Corp, which has argued it should have veto rights because of its partnership with Toshiba. The two sides are currently in binding arbitration talks. – Bloomberg