TOKYO, Japan – Toshiba, one of Japan’s most prominent brands, has been delisted from the Tokyo exchange after 74 years, marking the end of an era filled with scandal and upheaval.
The conglomerate is now transitioning into private ownership through a $14 billion takeover led by a consortium of investors, primarily spearheaded by private equity firm Japan Industrial Partners (JIP).
Other key contributors to the buyout include financial services firm Orix, utility company Chubu Electric Power, and chipmaker Roh.
The delisting follows a tumultuous decade for Toshiba, marked by internal strife and scandals that led to battles with foreign activist investors.
The company, known for its diverse portfolio encompassing batteries, chips, and nuclear and defence equipment, was hampered by prolonged conflicts with overseas stakeholders.
In a statement, the Japanese company expressed gratitude for the support from its stakeholders, emphasizing the company’s commitment to forging a new future under its new ownership.
The exact trajectory of Toshiba’s evolution under the new owners remains unclear, but Chief Executive Taro Shimada, who will continue in his role post-buyout, is expected to shift the focus toward high-margin digital services.
The $14 billion takeover by domestic investors ends Toshiba’s struggles with overseas activists and aligns the company with Japanese interests.
The transaction is regarded as a pivotal move for the company, opening up possibilities for restructuring and reshaping its business landscape.
Damian Thong, Head of Japan Research at Macquarie Capital Securities, reflected on Toshiba’s challenges, attributing them to a mix of strategic missteps and unfortunate circumstances.
Thong expressed hope that through divestitures, Toshiba’s assets and talent could find new avenues where their full potential could be realized.
The Japanese government will closely monitor the transition, given Toshiba’s significant role in national security and its employment of around 106,000 people.
The consortium, led by JIP, will introduce new executives to Toshiba’s board, setting the stage for a fresh management approach.
The company has already begun strategic moves, teaming up with Rohm to invest $2.7 billion in manufacturing facilities for joint production of power chips.
Toshiba’s future trajectory may involve divesting from lower-margin businesses and refining commercial strategies for advanced technologies.
Ulrike Schaede, a professor of Japanese business at the University of California, San Diego, emphasized the company’s potential as a deep tech player, provided its management can steer the organization toward breakthrough innovation activities.
As Toshiba steps into this new chapter, the global business community watches closely to witness the transformation of one of Japan’s iconic corporations.
