Japanese Fund Raising Corporate Capital Submits Bid to Toshiba... "Outcome Uncertain"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] The local investment fund 'Japan Industrial Partners (JIP)', which is pursuing the acquisition of Japanese conglomerate Toshiba, has officially submitted a purchase offer worth 2.2 trillion yen (approximately 20.9 trillion KRW) to Toshiba, according to reports from Nihon Keizai Shimbun and Kyodo News on the 8th.

According to the reports, JIP, which secured the exclusive negotiation rights for Toshiba's acquisition last month, submitted a purchase proposal to Toshiba centered on acquiring all shares worth 2.2 trillion yen funded by Japanese companies and delisting the company.

JIP secured about 1 trillion yen in funds from more than ten Japanese companies, including ORIX and Chubu Electric Power. JIP plans to borrow the remaining amount from financial institutions but has not yet received a commitment for loan guarantees. Nihon Keizai stated, "However, if Toshiba accepts the delisting based on this purchase proposal, negotiations are underway to complete the loan procedures within this month."

In the purchase proposal, JIP stated that it would not change the current Toshiba management, including President Taro Shimada, but the financial industry reportedly has voices hoping for changes, according to Yomiuri Shimbun. Additionally, overseas investment funds, which are major shareholders of Toshiba, are known to desire a sale at a higher price.

Asahi Shimbun analyzed, "The proposed purchase amount falls short of initial expectations," and "there remain uncertain factors regarding whether discussions can proceed as they are." Yomiuri Shimbun predicted that if negotiations between Toshiba and JIP break down, the Japanese public-private fund 'Innovation Network Corporation of Japan (JIC)' might intervene.

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