New Move On Toshiba As Western Digital Start To Get Desperate
South Korean chipmaker Hynix has revealed a joint bid for beleaguered Toshiba’s memory chip business, along with US private-equity firm Bain Capital, the move could be a major blow to Western Digital.
Together Hynix and Bain,they are offering between US$9-13.5 billion for more than half of the business.
Western Digital who sell the over priced SanDisk products in Australia, is taking legal action to try to guarantee a say in who gets to buy the chip unit of Toshiba, its partner in a manufacturing joint venture.
Toshiba’s future as a public company depends on selling the memory chip unit to pay for losses incurred due to a coorruption scandal and through its struggling nuclear business
The Company has been reluctant to sell to non-Japanese companies.
Hynix has been ruled out once already as a suitor. But it is hoping the pairing with Bain will allay Japanese fears.
Meanwhile US Company Western Digital has invoked an arbitration clause in their business agreement, which could postpone a sale Toshiba needs to complete quickly.
In preparation for the divestment, the Japanese technology company transferred ownership of the unit to a separate legal entity but didn’t get permission before doing so, according to Western Digital. The two should enter binding arbitration to resolve the dispute, Western Digital said.
In response, Toshiba said it hasn’t received any notice of arbitration, and rejected claims that the process is in breach of the joint venture agreement.