Tosh’s Dilemma

Toshiba’s new boss has an interesting dilemma.

Should Toshiba stick to its word and flog its memory unit to Bain/Hynix for $18 billion?

Or should it kick Bain/Hynix into the long grass on the legalistic pretext that the China competition guys  didn’t OK the deal by March 31st which was a contractual condition for the deal?

Is Toshiba obliged to follow the interest of shareholders who could benefit from what Argyle Management Hong Kong says could be a $40 billion IPO?

Argyle is not totally out of the ball-park because Foxconn made a $30 billion bid in the so-called ‘auction’ process for the unit.

And Chinese money would pay a pretty price to get Tosh’s memory technology into Yangtze River’s fab.

All a very tricky dilemma for Toshiba’s incoming CEO.

I bet he hopes that China refuses to give permission for the deal. Then Tosh will be off the hook of its moral obligation to keep faith with Bain/Hynix and will be able to do what it damn well likes with its own memory unit.


Comments

6 comments

  1. I don’t know if the US President could overrule a US government approval of a takeover of a foreign company. If it’s a domestic company that’s being bought then Yes he can – there’s national security grounds to do so, and there’s CFIUS. But on what grounds could Trump object to Bain/Hynix buying Tosh after the US anti-trust authorities have OK’d it?

  2. Well I think you’re right about Apple’s involvement, martijn, it was all a bit secretive. I suppose Apple would very much like a captive source of NAND but, on the other hand, giving Hynix control of Tosh reduces the number of NAND suppliers from 4 to 3. Swings and roundabouts.

  3. Apple is part of the bain/hynix consortium right, so US will be pro the current deal.

  4. The Yanks have already OK’d it, Mike

  5. Surely they can just ask Trump to veto it ? Far quicker than worrying about what the Chinese intended to do.

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