Toshiba board to appoint UBS as adviser for strategic review

PHOTO: REUTERS/Yuriko Nakao/File Photo

Toshiba Corp’s board is set to appoint UBS as financial adviser to work on a strategic review for the Japanese conglomerate as it faces a possible private equity bidding war, people familiar with the matter said.

Last month, Toshiba became the target of a potential takeover bid and other bids could be forthcoming.

Investment banks have pitched to Toshiba‘s independent directors for an advisory role, the people, who could not be named as the information has not yet been made public, told Reuters.

A UBS spokesman in Japan declined to comment.

Toshiba also declined to comment specifically on the appointment of UBS, but said in a statement to Reuters that the appointment of advisers would help increase the transparency around its decision-making.

“The board is independently appointing financial and legal advisers, and will strategically consider ways to increase our corporate value from an independent standpoint,” it said in an emailed statement.

One of the sources said that UBS will also communicate with Toshiba shareholders. It will have a separate role from Goldman Sachs, which is an activist defence adviser for Toshiba‘s management team.

An announcement of the appointment could be made as soon as Friday at Toshiba‘s earnings briefing, the person said.

Toshiba has faced calls from its leading shareholders to explicitly seek offers from potential suitors and undergo a strategic review following a $20 billion buyout bid from CVC Capital Partners last month.

The future ownership of Toshiba, however, remains uncertain after CVC later said it would “step aside and await guidance” from the company after the Japanese conglomerate dismissed the bid as lacking in substance.

U.S. buyout firm Bain Capital is also considering a bid to take Toshiba private, Reuters reported last month, and has entered discussions with banks to secure funding for its potential deal. Bain had declined comment.

KKR & Co Inc and Canada’s Brookfield Asset Management are also interested in Toshiba, sources have said. KKR and Brookfield had previously declined to comment on reports of potential bids.

A senior executive at one of Toshiba‘s main lenders said last month that several private equity funds had contacted his bank for potential financing to take the company private, but no talks are in progress.

CVC had approached Bain about a joint bid before its offer was made public but Bain was not interested, the first person said.

Bain has successfully tackled a major complex deal that involves Toshiba.

In 2017, it led a consortium with partners including South Korean chipmaker SK Hynix and Apple Inc to win an intense and long-fought battle for control of Toshiba‘s chip unit, now called Kioxia Holdings.

Toshiba retains around 40% of Kioxia.

Reuters

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.