Japan Industrial Partners — Toshiba, the Japanese conglomerate known for its diverse range of products, has announced its support for a 2 trillion yen takeover bid by a consortium led by investment fund Japan Industrial Partners. The move comes after years of financial trouble, scandals, and high-level resignations, which have rocked the once-illustrious company.
The JIP-led consortium includes 17 Japanese businesses and six Japanese financial institutions, which are investing in or issuing loans for the deal. If approved, the acquisition is expected to take the engineering giant private, marking a new chapter in the company’s tumultuous history.
In a statement issued after a board meeting, Toshiba said that it would ask a special committee to review the deal before recommending how its shareholders proceed. It expressed its support for the tender offer but did not go as far as recommending it at this point. The company said that the takeover bid is likely to get underway in four months’ time.
This news follows a bombshell buyout offer from private equity fund CVC Capital Partners nearly two years ago, which put a question mark on Toshiba’s future. Plans were floated to split the company up and spin off its device segment, but this was met with opposition from investors who argued that it would only add to Toshiba’s managerial woes.
The engineering giant’s history can be traced back to 1875 when its forerunner operated as a telegraph factory in Tokyo. It grew into a vast conglomerate but was rocked by turbulence in 2015 when a profit-padding scandal erupted. This led to huge losses, followed by a recovery that brought pressure from new activist shareholders.
Foreign investors have kept Toshiba afloat, but have also pushed for faster growth and a clearer long-term strategy. The company’s recent decision to support the takeover bid may be a step towards addressing these concerns and stabilizing the company’s future.
The Toshiba saga has been closely watched in business circles for clues on what could become of other huge, diversified conglomerates in Japan and elsewhere. As the company moves towards a potentially transformative acquisition, it remains to be seen what impact this will have on the wider corporate landscape.