The electronic giant Apple Inc. is joining hands with its one of the supplier Foxconn to bid for the Toshiba’s sizeable computer memory business. Toshiba is the world’s second-biggest memory chip maker and this business in on sale by the company.
As per sources, Apple is going to spend some billions of dollars to take a stake of about 20 percent of the firm. The report assumes that Toshiba would maintain a partial stake to keep the business under the US and Japanese control. Apple Inc. did not make any comment on this matter.
Toshiba is a leading manufacturer of the electronics world, and they are also a major supplier of Apple iPhone components. They released their first financial report for nine months. It showed almost $6 Billion dollar loss due to the problem of Nuclear Power Business at Westinghouse. Also, delays in projects and costs overrun at the South Carolina and Georgia makes it harder to face this situation.
The memory chip business is one of the backbones of the company. This business reported a profit of $934 million dollars on the sale of $5.8 billion dollars. Thus, Toshiba has to prepare their mind to sell this business to overcome from this multi-billion dollar loss.
This chip making business runs as a joint venture with Western Digital. This company is also one of the bidders for this chip business. They have a deal to give the U.S. company exclusive negotiating rights to overtake any of Toshiba’s business. They also warned Toshiba about this matter for violating the joint venture contract. Also, the report suggests that Japan is not at all willing to sell the business to any foreign company. The country doesn’t want to share the Japanese semiconductor technology to foreign companies as it may be a threat to the national security.
Auditors suggest – “It is an unusual move for a Japanese company—and with a warning that the entire company could collapse.”
Reports suggest that Toshiba has selected four suitable bidders to buy their business. They are –
- Broadcom Ltd – U.S. Chipmaker – Partner with private equity firm Silver Lake Partners LP.
- SK Hynix (000660.KS) – South Korean chipmaker
- Foxconn – World’s largest contract electronics maker
- Western Digital – American computer data Storage Company.
Now, the future will prove who wins the bid and acquire the Toshiba’s Jewel – the chip business.
the reuters report