Toshiba will form a special committee to evaluate potential bids from private equity and other investors, opening the door to a landmark deal to bring one of the company’s biggest names to the world. Japan’s largest private enterprise.
Committee likely received its first deal proposal from US private equity firm Bain Capital last week Qualified support is guaranteed for an acquisition deal from Toshiba’s largest shareholder, Singapore investment fund Effissimo.
People familiar with the situation say Bain’s bid preparations are at an advanced stage, but they also note the significant technical and political challenges of owning a 146-year-old brand. whose businesses range from infrastructure and refrigeration to nuclear power and defense. .
People close to some of the major PE funds likely involved in discussions with Toshiba say that, given the sensitivity surrounding some of its core businesses, any acquisition would be Success would require a substantial Japanese contingent among its investors.
People close to Toshiba say that while there are clear divisions on the matter within the company, a growing number of senior figures have concluded that a private deal could provide the best route to the issue. The company tackled years of business uncertainty and growing deadlock. active shareholders.
The announcement by Toshiba, which has a market value of about $17 billion, came on Thursday night. It follows a strong upward pressure on such a move from major investors and letter was sent to Toshiba’s board by the company’s second-largest shareholder, 3D Investment Partners, on Wednesday.
The decision by Toshiba’s board of directors is the starting shot in what the company’s more vocal investors hope will be a battle of spirits between rival investment groups. A strategy review committee convened last year discussed potential acquisitions with a list of PE firms including KKR, Blackstone and Brookfield.
Those negotiations, seen by some investors as inadequate, avoided the pricing issue, and the committee concluded in November that no proposal from the PE firms was more appealing than the idea of a spin-off. Toshiba into three companies – a plan that was quickly abandoned. after strong objections from shareholders.
The new committee, which Toshiba said will “engage with potential investors and sponsors and consider strategic alternatives,” will include six current independent Toshiba directors, including Tiga Investments founder Raymond Zage and former Noble Group executive chairman Paul Brough.
Toshiba said discussions with potential investors will begin as soon as possible. A company spokesman said that privatization is not a precondition for the committee, which will consider all possible strategic options.
The decision to form the committee, made during a board meeting on Thursday, does not involve newly appointed chief executive officer Taro Shimada, who has yet to be elected as a board member.
The committee will provide the most up-to-date information on potential bids before Toshiba’s annual shareholder meeting in June.
Toshiba alone said that management will develop a new business plan that will be announced before the AGM.
