Toshiba Corp said that it might book a write-down of several billion US dollars related to an acquisition made by US unit Westinghouse Electric.
The company’s shares fell 12 percent to ￥392 at the close in Tokyo yesterday, their biggest decline since December last year, after earlier reports that it might book a loss of as much as ￥500 billion (US$4.27 billion).
Toshiba issued a statement after the market closed, saying that while the final charge was yet to be determined, it would impact earnings.
The reported loss is related to a dispute over the value of an acquisition by Westinghouse Electric, the Nikkei newspaper reported on its Web site.
The write-down would come to about ￥100 billion, the newspaper said, while broadcaster NHK said the charge might total as much as ￥500 billion.
Such a loss would eclipse the ￥168 billion in net income that analysts are projecting, on average, for Toshiba’s current fiscal year through March. The Tokyo-based company booked a loss of ￥460 billion last year.
“Assuming the article to be accurate, we would expect Toshiba’s weak financial standing to be damaged further,” Mizuho Securities Coid analyst Takeshi Tanaka said.
Toshiba did not elaborate further in yesterday’s statement to the Tokyo Stock Exchange, other than to say that the writedown would exceed an initially anticipated amount of US$87 million, and would probably be in the billions.
The increase in charges is related to project costs incurred by CB&I Stone & Webster Inc, a nuclear construction and services provider that was bought by Westinghouse Electric in January.
Toshiba shares had climbed 77 percent this year through Monday as the company recovered from an accounting scandal that claimed the jobs of three company presidents, led to record losses and prompted the company to cut staff and sell off businesses.
The conglomerate, which makes everything from refrigerators, chips and computers to nuclear power equipment, is also being sued by shareholders accusing it of misleading them about its finances.
Toshiba was fined a record ￥7.4 billion in December last year after Japanese regulators found the manufacturer misled investors by filing false financial statements.
The watchdog has also been gathering evidence to determine whether to seek criminal prosecutions of former bosses over the scandal.
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