Group raises its offer for Toshiba chip unit
Bain and SK Hynix group hikes its bid for Toshiba chip unit to $22bn
Tokyo — A group including Bain Capital and South Korea’s SK Hynix had raised its offer for Toshiba’s chip business to ¥2.4-trillion ($22.3bn), including a ¥200bn investment in infrastructure, sources said.
The offer by the consortium, led by the US private equity group and the South Korean chip maker as well as Japanese state-backed investors, was higher than an initial offer of about ¥1.94-trillion, according to the sources, who requested anonymity because the talks were confidential.
Bain and SK Hynix representatives were not immediately available for comment, while Toshiba declined to comment on details of the deal negotiations.
The move comes after sources said Western Digital, part of a competing group in final-stage talks with Toshiba, had revised its offer.
The sources said the US company would take a step back from the initial financing consortium to tackle Toshiba’s concerns that a Western Digital stake could lead to prolonged antitrust reviews.
It was unclear what its latest offer was, but sources previously said it was offering about ¥1.9-trillion.
Toshiba is desperate to sell the unit and cover billions of liabilities at its US nuclear unit, Westinghouse. Last week, it said it was considering three competing offers including one led by Taiwan’s Hon Hai, also known as Foxconn.
All three bidder groups had roped in Apple to bolster their offers, sources said.
Under their latest offer, Bain and SK Hynix offered to provide a combined total of around ¥567.5bn, while Apple would provide ¥335bn, according to sources. Toshiba would keep ¥250bn in the business. US technology firms and other Japanese companies were also expected to provide funding, while major banks were expected to provide a total of about ¥600bn in funds, the sources said.
Bain would have 49.9% of initial voting rights in the memory chip business, while Toshiba would have 40% and Japanese firms would have 10.1%.
Toshiba’s board was scheduled to meet on Wednesday to consider the offers, sources said.