Western Digital filed for arbitration with the International Chamber of Commerce (ICC) with the goal of stopping Toshiba from selling its chipmaking division that also contains assets of a joint venture that the two companies have been running for years. While the Irvine, California-based data storage firm isn't inherently opposed to the notion of its partner selling its chip-manufacturing operations, the company is displeased abut recent developments and wants to stop the Tokyo, Japan-based tech giant from going through with the transaction without its consent, as well as force the company to exclude their joint venture from Toshiba Memory, a recently established unit that was formed specifically for the purpose of being sold. The U.S. firm previously bid for Toshiba's chipmaking arm but its offer was reportedly not close to those made by other interested parties.
As Western Digital believes that Toshiba is violating the terms of their joint venture agreement by putting shared assets into Toshiba Memory and faced with a lack of alternatives, the company opted to file for arbitration, its Chief Executive Officer Steve Milligan said on Monday. In a news conference held after Western Digital's filing with the ICC, Toshiba CEO Satoshi Tsunakawa stated that recent developments won't delay the firm's sale plans that will continue on Friday after the second bidding round on Toshiba Memory is completed. The Japanese tech giant's top executive also dismissed Western Digital's filing as having no basis, implying that the company's partner won't be able to stop the transaction.
Toshiba has been trying to sell its chipmaking unit for several months now as the firm faces major financial issues caused by the bankruptcy of its U.S. nuclear division Westinghouse Electric. The sale of Toshiba Memory may inject up to $18 billion into Toshiba, though some of the company's investors previously criticized the decision as being short-sighted due to the fact that the assets it's trying to sell are its best-performing ones. It's currently unclear whether Western Digital has a realistic chance of delaying the transaction but an update on the situation is expected to follow in the coming months once ICC processes the arbitration filing.