Toshiba, Western Digital Settle, Sale of Memory Business to Proceed
Toshiba Corporation of Tokyo, Japan, reported today that it and its partner in Toshiba Memory Corporation, Western Digital, have entered into a global settlement agreement to resolve their ongoing disputes in litigation and arbitration, and strengthen their relationship, with all parties agreeing to end litigation and arbitration actions.
Toshiba has been seeking to sell its Toshiba Memory Corporation to a consortium led by private-equity firm Bain Capital in order to cover losses incurred by its now-bankrupt U.S. nuclear-power business Westinghouse. Its partner in the memory business, Western Digital, has sought to stop the sale however.
As part of the new agreement, Toshiba Memory Corporation and Western Digital will also participate in future rounds of investment in Fab 6, a memory-fabrication facility now under construction in Yokkaichi, Japan, including the upcoming investment round announced by Toshiba in October 2017. Fab 6 will be entirely devoted to the mass production of BiCS FLASH, the next-generation of 3D flash memory, starting next year. Toshiba Memory Corporation and Western Digital will also together participate in the new flash-wafer fabrication facility which will be constructed in Iwate, Japan.
Commenting on the agreement reached today, Dr. Yasuo Naruke, senior executive vice president of Toshiba Corporation and president and CEO of Toshiba Memory Corporation said: “We are very pleased to have reached this outcome, which clearly benefits all involved. With the concerns about litigation and arbitration removed, we look forward to renewing our collaboration with Western Digital, and accelerating TMC’s growth to meet growing global demand for flash memory. Toshiba also remains on track to complete our transaction with the consortium led by Bain Capital by the end of March 2018. This will ensure that TMC has the resources it needs to continue to innovate and deliver for a fast-growing flash memory market, particularly in areas driven forward by advances in AI and IoT.”
The news come on the heels of reports that a new Hong Kong-based investor, Argyle Street Management, in Toshiba is said to have said that the sale of the memory business to the Bain Capital group “is no longer necessary after its recent capital injection.”
- December 2017: Hong Kong Investor Tells Toshiba Sale of Memory Business Not Necessary
- December 2017: Toshiba, Western Digital, Said to be Close to Deal Approving Memory Business
- November 2017: Toshiba Seeking to Sell Westinghouse Electric, But Not PC
- November 2017: Toshiba Seeking to Sell TV Business to Chinese Company for $114 Million
- November 2017: Toshiba Reports Loss for Half, but Memory Business Records Strong Performance
- October 2017: Toshiba Revises Forecast, Expects Net Loss of Almost $1 Billion
- September 2017: Western Digital Seeks Injunction to Stop Sale of Toshiba’s Memory Business
- September 2017: Toshiba Says it Will Sell Memory Business to Consortium Led by Bain Capital
- August 2017: Troubled Toshiba Said to be Close to Selling Memory-Chip Business (Updated)
- August 2017: Toshiba Reports $8.8 Billion Loss for Fiscal Year
- July 2017: Epson to Replace Toshiba on Tokyo Stock Exchange
- July 2017:Toshiba Served with New $83 Million Lawsuit; 28 Lawsuits in Total
- July 2017: Nikkei Demotes Toshiba on Tokyo Stock Exchange; Faces Delisting