Embattled conglomerate Toshiba on Friday completed the $21 billion (roughly Rs. 1.41 lakh crores) sale of its prized chip unit to an investment consortium, a move seen as crucial to keeping the Japanese firm afloat.
The deal had been delayed while Chinese regulators examined whether it could violate anti-trust laws, but they finally granted approval in mid-May.
“Toshiba hereby gives notice that the closing of the sale has been completed today as scheduled,” the group said in a statement.
It added that the deal was worth about JPY 2.3 trillion ($21 billion or about Rs. 1.41 lakh crores).
The business was sold to KK Pangea, a special-purpose company controlled by a consortium led by US investor Bain Capital.
Toshiba said it was reinvesting a total of JPY 350.5 billion (roughly Rs. 21,600 crores) in Pangea, acquiring a 40.2 percent stake.
The sale and reinvestment will give Toshiba a pre-tax profit of JPY 970 billion (roughly Rs. 59,600 crores), though the bump was already built into forecasts it announced last month.
Toshiba agreed in September to sell its memory chip business in a bid to stay afloat after multi-billion-dollar losses.
It struggled after the disastrous acquisition of US nuclear energy firm Westinghouse, which racked up billions of dollars in losses before being placed under bankruptcy protection.
In order to survive and avoid delisting, the cash-strapped group decided to sell the chip business – the crown jewel in a vast range of businesses ranging from home appliances to nuclear reactors.
Toshiba said last month it had bounced back into the black, avoiding a humiliating delisting from the Tokyo stock exchange.
The firm booked a record net profit of JPY 804 billion (roughly Rs. 49,400 crores) for the year ending March 31, compared with a loss of JPY 965.7 billion (roughly Rs. 59,300 crores) a year earlier.
That marks the first net profit for the firm in four years, and was helped by one-off revenue from tax cuts linked to the sale of its nuclear units.