Nikkei Demotes Toshiba on Tokyo Stock Exchange; Faces Delisting
The Financial Times reports that Nikkei Inc. will demote financially beleaguered Toshiba Corporation from the first tier to the second tier on the Tokyo Stock Exchange.
According to The Financial Times: “Toshiba faces an estimated loss of ¥995.2bn ($8.9bn) for the year that ended March 31. It has negative shareholder equity of ¥582bn, which means that its demotion is automatic. The company’s shares will be delisted if it remains in negative equity for two consecutive years.”
Toshiba, which has failed to report its full-year financial results in March as required, is seeking to cover billions of dollars in losses from its U.S.-based Westinghouse Electric, which has sought bankruptcy protection, by selling its Toshiba Memory Corporation to a consortium of investors that consists of Innovation Corporation of Japan, Bain Capital Private Equity (South Korea), and the Development Bank of Japan. According to Reuters, the consortium’s bid cleared Toshiba’s 2 trillion yen ($18 billion) minimum.
Toshiba, split off Toshiba Memory Corporation in April 2017 as a wholly owned subsidiary, and the sale of the memory business is said to be essential in order for Toshiba to cover billions of dollars of losses from its now-bankrupt U.S. nuclear unit Westinghouse Electric.
However, Western Digital, a U.S.-based partner in Toshiba Memory Corporation, has filed a lawsuit seeking to block the sale; Toshiba in return has filed a lawsuit against Western Digital.
Last month, Toshiba received an extension to file its full-year earnings reports. Ultimately, if it fails to file its full-year report very shortly, it faces delisting from the Tokyo Stock Exchange.
- June 2017: Toshiba Sues Western Digital; Fails to Meet Self-Imposed Deadline to Sell Memory Business
- June 2017: Foxconn Chairman Slams Toshiba’s Proposed Sale of Memory Business
- June 2017: Toshiba Set to Sell Memory-Chip Business to Consortium of Investors
- June 2017: Western Digital Seeks to Block Toshiba’s Sale of Memory-Chip Business
- June 2017: Toshiba Determined to Sell Memory-Chip Business Despite Hurdles
- May 2017: Toshiba Not Reporting Audited Full-Year Financial Results at Shareholders’ Meeting
- May 2017: Report: Toshiba Corp May be Considering Bankruptcy
- April 2017: Toshiba Splitting Off Four of its Companies into Wholly Owned Subsidiaries
- April 2017: TABS CEO Reassures Clients in Wake of Toshiba Corp. Difficulties
- March 2017: Toshiba Approves Sale of Chip Business; Foxconn May be Bidder
- April 2017: Toshiba Reports $5.9 Billion Loss, Warns of Ability to Continue as Going Concern
- March 2017: Troubled Toshiba Fails to Submit Audited Third-Quarter Earnings