Toshiba receives £14.5 billion takeover bid

Toshiba has confirmed that it has received a proposal to be acquired by CVC Capital Partners, a Luxembourg-based private equity firm.

In a note published on its website, the company said: “Toshiba received an initial proposal yesterday, and will ask for further clarification and give it careful consideration. The company will make a further announcement in due course.”

The offer, which is for a reported $20 billion (£14.5 billion), came from private equity firm CVC Capital Partners, which has an office in London and its official headquarters in Luxembourg.

Toshiba has had a rocky few years which saw it hit by scandals and forced to sell parts of its business. Over a period of seven years, the Japanese tech giant claimed its profits were $1.3bn higher than they really were, which became known as the Toshiba accounting scandal in 2015. Japan’s Securities and Exchange Surveillance Commission recommended a $60 million penalty to the firm following the accounting fraud.

Toshiba’s president and vice-president left the company as an independent panel found it had overstated its profits.

In 2017, the company was facing up to $5 billion in losses and attempted to sell its memory chip business in an attempt to raise money. It experienced difficulty as its joint-venture partner, Western Digital, was concerned the sale might violate the companies’ contract. The two companies fell out, particularly as one of Western Digital’s rivals tried to participate in a bidding consortium for the business. Ultimately, Toshiba sold its flash memory unit for $18 billion to a group led by Bain capital.

Furthermore, the company was looking to offload its memory chip unit in 2020 by selling a 40.2% stake in flash memory chip manufacturer Kioxia Holdings. It reportedly wanted to escape the volatility of the semiconductor market.

A few months later, Toshiba officially exited the laptop business after a 35-year run. It sold its remaining 19.9% stake in the Dynabook laptop brand to Sharp. The sale came two years after Sharp bought an 80.1% stake of Toshiba’s PC business for $36 million (£27 million).