Joint Venture Dispute Between Toshiba and Western Digital Escalates, Toshiba Still Unable to Sell NAND Business


Joint Venture Dispute Between Toshiba and Western Digital Escalates, Toshiba Still Unable to Sell NAND Business

Due to serious financial difficulties, Toshiba is trying to sell off their stake of their very successful flash memory business to keep the rest of the company afloat. Western Digital, as a result of their acquisition of SanDisk last year, owns half of the joint venture that Toshiba is selling their stake in. Western Digital would prefer to buy out Toshiba's share to strengthen their own position in the market, but they have struggled to keep up with the bidding as offers climb past ¥2T ($17.8B). The leading bidder has been a consortium with backing from the Japanese government and many major Japanese corporations through the Innovation Network Corporation of Japan and the Development Bank of Japan, as well as investments from Bain Capital Private Equity and rival memory manufacturer SK Hynix.

Western Digital has asserted that the terms of their joint ventures with Toshiba require SanDisk's approval before Toshiba can sell their stake, and Western Digital has not given their consent to any sale. This has not stopped Toshiba from continuing to negotiate a sale, so Western Digital has predictably taken legal action. In May Western Digital began arbitration proceedings through the ICC International Court of Arbitration. Toshiba made a partial concession by rolling back the spin-off of some of the memory business assets they were preparing to sell, but their overall plan did not change and Western Digital was not placated. Earlier this month, Western Digital filed for an injunction preventing Toshiba's sale until the arbitration was resolved. Western Digital's action was filed in the Superior Court of California for the County of San Francisco.

As the dispute developed, Western Digital and Toshiba continued normal day to day operations of their business, including announcements around Computex about their upcoming SSDs using their 64-layer BiCS3 3D NAND, and the announcement earlier this week of their development of 96-layer BiCS4 3D NAND. Toshiba was hoping to complete a deal with the winning bidder at a shareholder meeting yesterday. In the weeks

Joint Venture Dispute Between Toshiba and Western Digital Escalates, Toshiba Still Unable to Sell NAND Business

5 months ago - 3:00 AM EST - Thu, Jun 29, 2017

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