Toshiba To Spin Off Memory Business By Selling Some Of It


Toshiba has announced that their memory business, which nets about 75% of the company's profits, will be separated from the rest of Toshiba's interests, and some of that business will be sold off in order to help make up for over expenditures in Toshiba's nuclear interests in America. According to Toshiba CEO Satoshi Tsunakawa, the amount sold will be less than 20% of the total interests of the new memory division, and the remainder will be under his direct supervision. Toshiba has yet to announce exactly how much they plan to sell off or to whom, but a sale to the most likely partner, Western Digital, would put Toshiba's market share in the memory sector in arm's reach of Samsung, who is the top memory producer in the world and Toshiba's direct superior in the field. Additionally, their entire $3 billion in shareholder equity depends on getting a sale put through by the end of the fiscal year in March.

Toshiba's urgent need to get a deal inked stems from charges of roughly $6 billion due to the actions of Toshiba's foreign nuclear operations, focused on nuclear plant manufacturing contracts in the United States. Specifically, a nuclear operation that Toshiba's Westinghouse arm purchased not long ago is running far over budget and generating huge losses. Because of this loss, the nuclear operations are currently under review by Toshiba.

Selling off a part of their memory business may seem like a counterproductive way to grow their business, but a unique benefit of selling to Western Digital is that they are a close partner with Toshiba. This means that, rather than losing the stake of their business that they sell off entirely, if Toshiba sells to Western Digital, Toshiba will instead begin doing work for them, while Western Digital will gain control over the assets and manpower that the stake entails. This means that Western Digital and Toshiba's market share will overlap, leading to a favorable position in the market. Estimates peg the position they'd be in as one that's close to where Samsung is, sitting pretty at 36.6% of the market, and will give them room to surpass the South Korean giant at last.

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Senior Staff Writer

Daniel has been writing for Android Headlines since 2015, and is one of the site's Senior Staff Writers. He's been living the Android life since 2010, and has been interested in technology of all sorts since childhood. His personal, educational and professional backgrounds in computer science, gaming, literature, and music leave him uniquely equipped to handle a wide range of news topics for the site. These include the likes of machine learning, Voice assistants, AI technology development news in the Android world. Contact him at [email protected]

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