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Toshiba considers $20 billion CVC buyout offer, but Japanese government would have to approve the deal

By Pierre Briançon

Toshiba shares jumped 18% on Wednesday before trading was suspended in Tokyo

Japanese company Toshiba said on Wednesday (link) it would give "careful consideration" to a $20 billion offer led by global private-equity group CVC Capital Partners, at a 30% premium to the troubled conglomerate's share price.

The outlook: Toshiba's wide range of businesses -- from nuclear plants to sewage facilities, electronic products, and batteries -- makes it likely that the company's full takeover by a foreign owner will be carefully assessed by the Japanese government, which would have to approve the deal.

Critics of the company's current management may argue that the mooted deal might help Kurumatani keep his job, although activist funds would book a hefty profit from the buyout, even at its current rumored price, which could be raised at a later stage.

But the current valuation of Toshiba and the nature of its many businesses could also lead to a break up of the Japanese company, which would help to extract value. Depending, of course, on whether the Japanese government agrees on such an outcome.

More:Japan's Toshiba giving 'careful consideration' to acquisition bid by global fund (link)

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04-07-21 1559ET

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