Japan’s Toshiba calls extraordinary meeting to discuss investment strategy

FILE PHOTO: The logo of Toshiba Corp is seen behind a traffic signal at its headquarters in Tokyo, Japan January 27, 2017. REUTERS/Toru Hanai/File Photo

Toshiba Corp, which has faced pressure from some big shareholders over its investment strategy, said on Friday that it would hold an extraordinary meeting on March 18 and promised to return excess capital to investors.

The decision follows separate demands for such an extraordinary shareholder meeting from two large investors – Singapore-based Effissimo Capital Management and U.S. hedge fund Farallon Capital Management.

The usage of excess capital is a focal issue raised by Farallon Capital, which is asking  Toshiba to seek shareholders’ approval over what it said was a change in investment strategy in favour of large-scale mergers and acquisitions.

“Capital in excess of the appropriate level will be used for shareholder returns,” executive officer Masaharu Kamo said at an earnings briefing, an apparent change in tone from November when he said the firm would be proactive in making investments including M&A.

Kamo had said three months ago that the company “would use excess funds to buy back shares if no there are no strategic investment opportunities” that meet its criteria.

On Friday, though, he said the company had made no change in its policy on shareholder returns.

Farallon has bashed Toshiba‘s poor M&A track record, saying the company has recorded a total of about 1.8 trillion yen ($17.4 billion) of impairment losses in the past 20 years resulting from “heedless growth investments”.

Farallon declined to comment on Toshiba‘s latest statement on excess capital.

Toshiba said its third-quarter operating profit doubled from the same period a year earlier to 20.9 billion yen ($199.45 million), boosted by strong demand for automotive power-management chips amid a global chip shortage.

Its chip plants are running nearly at full capacity and the company is preparing to boost production, Kamo said.

Toshiba maintained its profit forecast for the year ending March at 110 billion yen, down 15.7% from the previous year.

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.