Toshiba executives fronted up to the company’s annual shareholder meeting in Japan on 28 June warning investors that they would need to wait just a little longer to see the sale of its flash memory chip business.
The embattled Japanese tech giant revealed on 21 June that its board had come up with its top pick for a buyer for the company's storage business, Toshiba Memory Corporation.
The consortium of buyers which got the tick of approval includes the Innovation Network Corporation of Japan, the Development Bank of Japan and Bain Capital.
However, Toshiba subsequently notified its shareholders on 28 June that, while it had aimed to reach a “mutually satisfactory” definitive agreement with the consortium, negotiations were still continuing.
“It is taking time to reach a consensus because the consortium comprises multiple parties, and closure was not achieved by Toshiba’s target date,” the company said in a statement.
As it stands, Toshiba is not making any promises as to when the deal might close, simply indicating that it is hoping to wrap things up as soon as possible.
“Toshiba intends to continue the negotiation toward reaching a definitive agreement at the earliest possible date, and will announce this in a timely manner once the agreement is closed,” the company said.
Toshiba had previously said it hoped to reach an agreement with the consortium ahead of its annual ordinary general meeting of shareholders on 28 June, so the deal could be put to a vote.
Clearly, the deal is unlikely to come to a vote at the general meeting, potentially pushing back the expected sale date even further.
The company had said that if a vote is successful on 28 June, it hoped to close the transaction by March 2018.
The delay will likely come as a blow for Toshiba shareholders, who are no doubt eagerly waiting for the company to turn around its financial fortunes after it was hit by billions of dollars in losses from a US subsidiary.
Toshiba moved to put its flash memory business stake up for sale earlier this year in a bid to cover the losses incurred by the Westinghouse Electric Company, which it acquired in 2015.
The embattled Japanese tech company revealed in December last year that the goodwill impact from its acquisition of the US-based nuclear power plant construction and services company could “reach a level of several 100 billion yen or several billion US dollars”.
Google, Amazon, Apple, Foxconn Technology Group and Kingston Technology had previously been rumoured to be among the potential bidders for stock in the memory business, along with Western Digital, according to reports.
The US-headquartered storage technology company acquired SanDisk, which has been a long-term partner of Toshiba, last year.
In May, however, Western Digital sought arbitration over the proposed sale, demanding that its consent had to be taken before Toshiba can go ahead with plans to sell a stake in its memory business to raise its sought-after funds.
It seems this move has not prevented Toshiba from moving towards the closure of a sale of the memory business.