Toshiba board accepts JIP buyout proposal

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Toshiba board accepts JIP buyout proposal

TokYO Toshiba Corp's board agreed on Thursday to accept a buyout proposal worth around 2 trillion yen $15.3 billion from a consortium led by private equity firm Japan Industrial Partners JIP, the Nikkei business daily reported.

Toshiba was not available for immediate comment.

A binding buyout proposal submitted by the JIP consortium last month was backed by $10.6 billion in loan commitments from major banks.

The Nikkei said that the consortium will include about 20 Japanese companies, such as Orix Corp, Rohm Co and Chubu Electric Power.

If successful, the deal would draw a line under years of upheaval for the industrial conglomerate, ranging from accounting scandals, heavy losses, corporate governance concerns and friction with activist investors that led to a strategic review.

It took weeks for the board to pass a vote on JIP's proposal because some board members were discontented with its offer price, sources said.

If early reports are correct, this ends months of uncertainty regarding whether a deal is coming, and years of uncertainty regarding the Board understanding of the right price, said Travis Lundy of Quiddity Advisors, who publishes on Smartkarma.

This would give a lot of activists a way out, even if it wasn't what they hoped for. The question is whether Toshiba Fatigue' is strong enough to overcome disappointment on price.