Toshiba in Talks with Four Investment Firms, including Blackstone and KKR for Strategic Ideas

Aug 26, 2021 | News, SEAPEC

Toshiba Corp is in talks with at least four global private equity firms including KKR & Co Inc and Blackstone Inc to seek their ideas for its new strategy, according to three sources with knowledge of the matter.

Bain Capital and Canadian investment firm Brookfield have also been tapped by the scandal-hit Japanese conglomerate’s strategic review committee to put together and submit their ideas for Toshiba, the sources said.

The latest process is not meant to formally solicit buyout bids for the overall company or some of its assets, and it’s not immediately clear whether the engagement with buyout firms will result in formal offers in the future.

The step, however, indicates that Toshiba is engaging with potential bidders since shareholders ousted its chairman in June after the company was found to have colluded with the Japanese government to put pressure on foreign investors here.

After the chairman’s ouster, Toshiba, which has many lines of business and units and operates in several jurisdictions, launched a full review of its current assets, and also pledged to engage with potential strategic and financial investors.

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“As announced, Toshiba’s strategic review committee is considering and discussing a wide range of initiatives without delay,” Toshiba said in a statement to Reuters.

Toshiba, which had a market valuation of about $19bn as on Wednesday, “plans to present the achievements when we announce the new business plan in October,” it said, but declined to comment further.

Spokespersons at Bain, Blackstone and KKR declined to comment, while Brookfield did not immediately respond to Reuters request.

The sources declined to be identified as the talks were private.

At an earnings briefing this month, Toshiba Chief Executive Satoshi Tsunakawa said the company had been “vigorously engaged in dialogue not only with shareholders but also with financial and strategic investors.”

He also said that it was open to take-private bids although it had not received any offers since a $20bn takeover bid from CVC Capital Partners, which was subsequently dismissed as lacking details.

Toshiba’s previous CEO left in April over controversy about CVC’s buyout offer.

Toshiba’s Scandal

The company was found to have colluded with the government to suppress the interests of foreign investors., which led to Osamu Nagayama, the chairperson to step down. Some investors see the result as marking a new milestone for corporate governance in Japan.

One of Toshiba’s largest shareholders, 3D Investment Partners, which had previously called for Mr Nagayama’s resignation, welcomed the result.

“We hope that today’s AGM marks the beginning of a new era at Toshiba – one that will be marked by a focus on value creation, transparency to all stakeholders and a renewed commitment to building trust with shareholders,” it said in a statement to BBC News.

Source: Reuters

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