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© businesswire Business | January 30, 2017

Toshiba and Memory spin-offs

Toshiba has decided that the Memory business (including the SSD business, but excluding its image sensor business) of the Storage & Electronic Devices Solutions Company will be spun off by March 31, 2017.
This is about the extent to which Toshiba's announcement goes. Details on the plans are sparse: "there are still many undecided items, such as the assets to be transferred, which are still under review" and "the Company is still considering various structures with a view to an injection of third-party capital".

One of the reasons for splitting off the memory business into a single business entity is said to be greater flexibility in rapid decision-making as well as and enhancement of financing options – which then could lead to further growth of the business.

At the same time, Toshiba is facing potential losses and writedowns – which could reach several billion US dollars – related to the acquisition of CB&I Stone & Webster. Thus, Toshiba needs to enhance its financial structure, and the split along with the injection of third-party capital could be a way to soften the blow.

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October 16 2017 2:56 PM V8.8.6-2