Toshiba Corp yesterday said that three groups are vying for its memory chip business, as reports said Apple Inc has jumped into the race with a consortium offering to pay about US$20 billion for the unit.
The loss-hit conglomerate said bidders include a group led by US investment fund Bain Capital LP and Japanese state-backed investors, and another that includes Hon Hai Precision Industry Co (鴻海精密), better known as Foxconn Technology Group (富士康).
A third consortium includes Western Digital Corp, Toshiba’s US-based chip factory partner, which has tried to block any sale to a third-party in court.
Selling the profitable chip division is seen as key to cash-strapped Toshiba’s survival as one of Japan’s best-known firms struggles to plug multibillion-dollar losses at its US nuclear power division, Westinghouse Electric Co.
Toshiba did not mention Apple, which has joined the Bain-led consortium, according to reports in the Nikkei Shimbun and top-selling Yomiuri Shimbun.
Toshiba poured cold water on reports that it would make a final decision yesterday, saying it had been unable to reach a “mutually satisfactory definitive agreement with one of the consortia.”
It did not elaborate.
“The negotiation with each consortium has not reached the point which will allow Toshiba’s Board of Directors ... [to] make a decision regarding the sale” of the chip business, it added in a statement.
Talks would continue with possible bidders with an eye on a reaching a deal “at the earliest possible date,” it said.
Earlier reports said Bain brought Apple into the bidding group to stay in the running as Toshiba leaned toward a deal with Western Digital.
Apple relies on Toshiba’s memory chips for iPhones and iPods, and wants a continued supply so it is not dependent on rival Samsung Electronics Co, Bloomberg News said, quoting people familiar with the matter.
Toshiba is the world’s No. 2 supplier of memory chips, behind South Korean titan Samsung.
“There are supply shortages of that type of memory,” Canaccord Genuity analyst Michael Walkley said.
“They’re always looking to work closely with key suppliers and lock in long-term supply agreements,” he said.
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