Toshiba still in talks over chip unit sale one day before deadline

Toshiba still in talks over chip unit sale one day before deadline sources

-South Korean consortium including South Korean chipmaker SK Hynix Inc., and a group led by Taiwan's Hon Hai Precision Industry Co. have made additional proposals in their respective bids for Toshiba Corp.'s flash memory unit, ahead of a Toshiba board meeting on Wednesday, informed sources have said.

As reported at Reuters; A deal would mark an end to months of uncertainty for Toshiba, which is scrambling to sell its flash memory unit - the world's No. 2 producer of NAND chips - to cover billions in losses at its bankrupt USA nuclear business Westinghouse.

The people also said Toshiba objected to the possibility of Western Digital eventually seeking control of the chip business, and so has sought a limit on any future stake.

Toshiba did not immediately respond to requests for comment.

The moves come as a team including USA hard disk drive maker Western Digital Corp.is now viewed as leading the bidding race. The board wants the sale, beset by legal wrangling and revised bids, to be decided by Wednesday when it meets, separate people involved in the talks previously told Reuters.

Toshiba's originally preferred bidders were funds backed by the Japanese government, SK Hynix and USA private equity firm Bain Capital LP.

The latest decision comes after Toshiba had been inclined to seal a deal with a group led by Western Digital, which has jointly invested in Toshiba's Yokkaichi flash memory plant in central Japan.

But those talks hit snags as Toshiba, fearing that Western Digital was angling to eventually take over the chip business, sought to control the USA firm's stake in return for a better position in their current chipmaking joint venture, the sources said. -South Korean group had said that Bain Capital and other entities in the group would take over INCJ and DBJ's investment until the legal spat with Western Digital is resolved while raising the price tag for Toshiba Memory Corp to 2.4 trillion yen, becoming a strong contender. Western Digital, Toshiba and a state-backed fund, the Innovation Network of Japan, which is a member of the consortium declined to comment.

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