Financial investor JIP wants to take over Toshiba for 14 billion euros

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Toshiba’s years-long acquisition saga is coming to an end. A consortium led by financial investor Japan Industrial Partners (JIP) is expected to make a bid worth a total of 14 billion euros by the end of July, the Japanese conglomerate announced on Thursday. The Board of Directors supports the offer, but refrains from recommending acceptance to Toshiba shareholders.

Toshiba, one of the most well-known companies in Japan, offers numerous products from memory chips to printers and air conditioners. In recent years, the group has been rocked by accounting scandals and, among other things, has lost billions due to the bankruptcy of the American nuclear subsidiary Westinghouse. In the ensuing dispute with activist investors over a reshuffle, Toshiba exhausted several CEOs.

The acquisition ended months of uncertainty about the future of the traditional group, says analyst Travis Lundy of investment advisor Quiddity Advisors. The sale price is lower than hoped, but the relief that there is finally a deal can outweigh that. Last year, insiders discussed a takeover bid with a size of up to 20 billion euros.

According to the information, JIP offers 4620 yen (32.28 euros) per share. That price is 9.4 percent higher than Thursday’s closing price on the Tokyo Stock Exchange. Stocks listed in Frankfurt grew at a similar pace.

Business goals lowered
Analyst Atul Goyal of investment bank Jefferies was skeptical about the deal. Toshiba apparently favored JIP as the buyer, as the financial investor indicated management and corporate changes would be limited. “We are now wondering how the group wants to create added value.”

Because Toshiba’s operations are anything but smooth: a few weeks ago, after a slump in earnings, the group lowered its business targets for the second time in a few months.

Source: Krone

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