Toshiba considering 11 possible futures
Management reveals 10 suitors, plus a digital transformation plan to become a software-defined business
Disgraced tech giant Toshiba has revealed it has received ten buyout proposals, and devised a plan to grow its digital businesses.
"As of today, the Company has received eight initial proposals for privatization, as well as two initial proposals for a strategic capital and business alliance with the Company remaining listed from Potential Partners," the Japanese conglomerate stated in a canned statement [PDF] dated June 2.
Toshiba didn't say who submitted the buyout proposals, but Bain Capital is known to have expressed an interest. Reports have indicated CVC Capital Partners and KKR might be in the running too. It's worth noting that CVC has sought this opportunity before.
Toshiba said none of the proposals were legally binding and it had been holding discussions with potential partners since April 21, 2022. The company promised to evaluate the proposals based on offer price, medium to long term enhancement of Toshiba's corporate value, financing arrangements, and likelihood of actually being paid, in addition to whether proposed deals will fly under Japan's competition and national security laws.
Evaluations of the proposals won't be ready until after the next annual shareholder meeting on June 28, 2022.
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The proposals come after years of embarrassment and scandals, such as conspiring with government officials to pressure shareholder votes and squeeze out activist foreign investors.
Toshiba attempted to split itself into three companies then, when that idea was rejected, two companies. But splitting up was panned by investors, who saw it as a way for Toshiba to shirk responsibility.
Management's latest attempt to plot a future course emerged yesterday, in the form of a cunning plan to transform. With data.
Toshiba released its Group Management Policy [PDF] that outlines a digital transformation effort which aimed at helping the company "discover new business potential from a data-oriented perspective."
The plan calls for Toshiba's software-centric personnel from across the company to come together to build platforms rather than individual solutions for each business unit. The Group Management Policy suggests an energy solution platform and a platform to collect purchase data as initial projects. The document suggests Toshiba needs to become more "software defined" and that once its digital transformation is complete, data services will be its primary source of revenue.
Revenue is also projected to rise to five trillion yen ($53.9 billion) and 600 billion yen in operating income by fiscal 2030. The plan also forecasts significant growth in its data services business, from five percent of operating income in FY2022 to 12 percent in FY2030.
Toshiba also said it will "consider working with external partners" on technologies with large target markets.
Of course, the overall strategy means nothing unless the new buyers agree to it – so things could change after June's shareholder meeting. ®