Is Apple Toshiba's newest chip bidder?

Is Apple Toshiba's newest chip bidder?

Troy Powers
September 1, 2017

Apple has joined a consortium of companies led by the investment firm Bain Capital in a revised [$18 billion] last-ditch offer for Toshiba's chip unit. Western Digital would loan money for the initial purchase with rights to take a minority equity stake in the future, the people said.

Apple may be about to put in a bid to buy Toshiba's chip business, joining United States private equity group Bain Capital's consortium to purchase the ailing business.

Under the group's proposal, Toshiba and Bain would own over 40 percent each of Toshiba Memory Corp, the sources said. One group include the Innovation Network Corp of Japan, Bain Capital Private Equity LP and Development Bank of Japan, while a second one includes Western Digital, and Hon Hai leads a third team.

Bain Capital's bidding group is now in competetion with storage manufacturer Western Digital, which already runs the facility in which Toshiba's chips are manufactured.

Toshiba has been in negotiations for months to sell off its chips business and pay for a disastrous move into the USA nuclear business.

By taking part in the bidding, Apple could help ensure a competitive supply chain and lessen its dependence on the chip division of Samsung, a key rival in the smart phone business.

Refugees would again be welcomed by Germany: Merkel
Therefore, the defiant chancellor told the anti-refugee hecklers that under her leadership, Berlin still welcomes asylum-seekers. Merkel then began to feel the political costs when her conservative party suffered losses in regional elections.

But the two sides are struggling to come to an agreement over the U.S. company's future stake in the business, several sources have said. Western Digital has also initiated legal action that threatens to derail any deal that does not have its consent.

A Toshiba spokesman said the company could not comment on details of the talks.

The announcement does not mention Apple, which Bloomberg reported on Wednesday is in talks with Bain Capital to submit an additional bid.

"That clearly appeals to Toshiba's impatient lenders but there are fundamental differences to resolve and it is still some way from producing a deal that Toshiba could sign".

Toshiba was working under creditor pressure to strike a deal by the end of the month, sources with direct knowledge have said, as any later would make it hard to gain regulatory approvals before its books closed in March.

"Western Digital and Toshiba really need each other because they can't compete against Samsung without partners", he added.