Japan JIP's Final Acquisition Proposal for Toshiba...Blocked Overseas Sale

[Image source=Yonhap News]

[Asia Economy Reporter Lee Ji-eun] The Japanese conglomerate consortium private equity fund (PEF) Japan Industrial Partners (JIP) has submitted a final acquisition proposal for Toshiba, the Nihon Keizai Shimbun reported on the 9th. This move prevents Toshiba, known as the "pride of Japanese technology," from falling into foreign capital hands.

According to the report, the Japan fund led by JIP has secured a loan commitment of 1.4 trillion yen (10.6 billion dollars) from major Japanese banks and submitted a final acquisition offer to Toshiba.

Mitsui Sumitomo Financial Group and Mizuho Financial Group of Japan have each agreed to issue commitment letters for loans of 515 billion yen and 460 billion yen, respectively. Separately, Toshiba plans to borrow 200 billion yen using working capital. The total acquisition amount is expected to be around 2 trillion yen.

Toshiba plans to hold a board meeting to decide whether to accept the acquisition proposal from the Japan fund led by JIP.

The JIP consortium is an alliance composed of local companies such as ORIX and Chubu Electric Power, as well as global investment firms including Baring Private Equity Asia and CVC Capital Partners. When Toshiba initiated a public sale process in March following a dispute with a foreign activist fund, the consortium requested participation in the acquisition from more than ten Japanese companies. This was to prevent Toshiba from falling into foreign capital hands like Sharp, the electronics manufacturer acquired by Taiwan's Foxconn.

JIP was selected as a negotiation partner after formally submitting a 2.2 trillion yen purchase proposal to Toshiba in October last year. Since then, ten companies including semiconductor group ROHM and financial services firm ORIX have secured funds totaling 1 trillion yen. Initially, JIP was expected to pursue the Toshiba acquisition jointly with the Japanese public-private fund "Japan Innovation Investment Corporation" (JIC), but due to differing directions, it bid alone.

Before JIP's acquisition efforts, in April 2021, the Europe-based investment fund CVC Capital Partners proposed acquiring Toshiba, but negotiations were effectively halted.

This content was produced with the assistance of AI translation services.