Report: Toshiba's Chip Unit Sale Halted Because Of Apple

Toshiba's sale of its NAND flash memory unit was halted because of Apple, i.e. the fact that the iPhone maker has yet to agree to some terms of the deal, Reuters reported on Monday, claiming that the Japanese company already notified its major creditors about the latest turn of events in the drawn-out saga which started almost a year ago. The Cupertino, California-based tech giant is a member of the consortium led by Bain Capital whose $18 billion bid for Toshiba's flagship division was accepted just last week following months of deliberation and even some purported internal clashes at the struggling firm. Apple has yet to provide Toshiba with a commitment letter that could be used for finalizing the main transaction, sources familiar with the matter said.

Toshiba supposedly disclosed its latest setback to banks as part of its rollover request for approximately $6.1 billion in credit lines which are expiring at the end of September, with its creditors reportedly refusing to comply until the company manages to sign a binding agreement with the Bain Capital-led consortium. The exact contents of the company's differences with Apple remain unclear, with the firm only stating that it's still adamant to conclude the transaction as quickly as possible. The deal remains subject to regulatory scrutiny and existing legal challenges from Western Digital, Toshiba's long-term joint venture partner that's still claiming the struggling company isn't able to liquidate its division without its consent, citing their previous collaboration agreement.

Toshiba will still be hoping to conclude the deal by mid-fall as it's facing a realistic threat of being delisted from the Tokyo Stock Exchange in Q1 2018 in the aftermath of the bankruptcy of Westinghouse Electric Company, its U.S. nuclear subsidiary which went under in early 2017, dealing a massive hit to the tech giant's books. Due to previous sanctions issued in response to a 2015 accounting scandal, Toshiba wasn't able to take out another loan to cover its losses and was forced to liquidate some of its assets. Being the most profitable business under its corporate umbrella, the NAND flash memory unit was chosen as the business that will be offloaded in spite of Western Digital's protests and subsequent lawsuits. Even if the firm's joint venture partner fails to prevent the deal, Japanese antitrust officials might still delay it seeing how Bain Capital's consortium also includes SK Hynix, a South Korean chipset manufacturer and one of Toshiba's direct competitors.

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Dominik Bosnjak

Head Editor
Dominik started at AndroidHeadlines in 2016 and is the Head Editor of the site today. He’s approaching his first full decade in the media industry, with his background being primarily in technology, gaming, and entertainment. These days, his focus is more on the political side of the tech game, as well as data privacy issues, with him looking at both of those through the prism of Android. Contact him at [email protected]
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