Toshiba to sell part or all of medical division
January 6, 2016
TOKYO – Toshiba Corp. plans to sell a majority stake in Toshiba Medical Systems, a maker of diagnostic imaging systems such as MRI, X-ray and ultrasound equipment, to outside investors.
“At least 50 percent and as much as 100 percent,” president Masashi Muromachi (pictured) told reporters in Tokyo. “That will depend on the talks with a buyer, but we already have been approached by several companies.”
Toshiba Medical, Japan’s largest medical equipment company, could fetch “several hundred billion yen,” Yukihiko Shimada, a senior analyst at SMBC Nikko Securities, wrote in a research note without giving a more specific estimate.
Toshiba Corp. fell to the lowest in more than six years in Tokyo after forecasting a record 550 billion yen ($4.5 billion) loss and announcing plans to cut more jobs as it restructures businesses. Recently, Moody’s cut its credit rating two levels to junk.
Toshiba has been dogged by an accounting scandal, prompting the company to consider third-party alliances for some units and a restructure of the business that makes TVs and PCs. President Masashi Muromachi is considering options such as listing the memory chip division or selling a majority stake in the medical equipment unit after restating earnings across seven years.
Muromachi is working with new management after former presidents Hisao Tanaka, Norio Sasaki and Atsutoshi Nishida resigned in July to take responsibility for the accounting irregularities. The company said it would seek damages in a lawsuit against former executives, including the three and two former chief financial officers, over their role in the scandal.
Toshiba itself still faces lawsuits from shareholders, while it has vowed to avoid recurrence by bringing in more outside directors and cut executive pay. Regulators have yet to announce the results of probes seeking evidence for possible criminal prosecutions of former executives.
In addition to workforce cuts in the lifestyle business, the company will reduce its corporate division by 1,000 people and chip operations by 2,800 workers. Toshiba had about 198,700 employees as of March 31, the lowest since at least 2009, according to data compiled by Bloomberg.