Yesterday it was reported that Western Digital is back in the running to buy Toshiba’s memory chip business after talks with the company’s preferred bidder fell through. So far, Toshiba’s asking price has been $18 billion but it looks like WD may try and get away with a lower offer.
According to Reuters’ sources, a consortium that includes Western Digital is offering Toshiba 1.9 trillion yen, which works out at $17.4 billion. It’s not just Western Digital chipping in though, two government linked organisations in Japan and a private equity firm will also be kicking some cash into the deal. KKR, Innovation Network of Japan and the Development Bank of Japan will be throwing 300 billion yen each into the bid. Other Japanese companies will also be kicking in various amounts of cash.
The reason behind so many groups chipping in to the bid is to ensure that Japanese companies still hold control of Toshiba memory Corp. By doing this, it is less likely that Japan’s business regulation authority will intervene in the sale.
Previous reports indicated that Toshiba is looking to wrap its memory corp sale by the end of this month in an effort to ensure everything goes through before the end of this financial year. With that in mind, we should hear more on this very soon.
KitGuru Says: There has been a lot of drama between WD and Toshiba throughout this sales process, so we will just have to wait and see how this plays out.