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Toshiba sold chip to consortium led by Bain Capital for $18 billion

Toshiba Corp. sold the chip unit to a consortium led by Bain Capital LP for US$18 billion. The giant Minato on Wednesday agreed to sell a valuable semiconductor business to a group led by a private equity firm in Boston. The move ended long negotiations as a key step in keeping the Japanese conglomerate struggling on the Tokyo bourse.

Tinuku Toshiba sold chip to consortium led by Bain Capital for $18 billion

The sale deal was Toshiba's attempt to cover billions of dollars losses after a defeat at Toshiba's nuclear business unit in the United States, Westinghouse, went bankrupt in March. The company this year is virtually removed from the Tokyo stock list after delaying the issuance of financial results.

Toshiba announced in the last time at a long and grueling auction that it has agreed to sign a deal worth about 2 trillion yen to sell chips and no explanation of the effect of this sale in the case of Western Digital.

Western Digital has previously taken legal action against Toshiba to the International Arbitration Tribunal to prevent the sale without their consent because of its position as a chip-making joint venture partner. Toshiba said the agreement assumed would face legal challenges posed by Western Digital.

The sale will boost Toshiba's finance by 740 billion yen after tax and will boost shareholders' equity. Bain Capital has partnered with South Korea's SK Hynix Inc. and brought in chip buyers such as Apple Inc. and Dell Inc to boost offerings.

Kingston Technology and Seagate Technology Plc also participated in the consortium. Bain has previously invited the Innovation Network Corp. of Japan (INCJ) and the Development Bank of Japan (DBJ). Until now both refused to comment.


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