Western Digital resubmits bid with KKR for Toshiba chip unit


Western Digital Corp. has said it resubmitted a bid with U.S. investment fund Kohlberg Kravis Roberts for Toshiba Corp.’s chip unit in a last-minute effort as the electronics giant moves closer to clinching a deal with a Japanese government-led consortium.

“Western Digital resubmitted a bid with KKR where Western Digital will provide debt financing to facilitate a sale by Toshiba Corporation of its interests in the NAND Flash Memory joint venture,” U.S. -based Western Digital said in a statement Monday.

“Western Digital continues to believe it is the best partner to advance Toshiba’s legacy of technology innovation in Japan.”

The U.S. firm is a chip production partner of Toshiba, jointly operating a flash memory plant in Mie Prefecture.

The U.S. partner has strongly opposed Toshiba’s plan to sell its chip unit, Toshiba Memory Corp., saying that any sale without its consent breaches a joint-venture contract.

The latest move comes after Toshiba last week picked a rival bid by a government-led Japan-U.S.-South Korean consortium as the preferred choice for Toshiba Memory.

Sources close to the matter said Western Digital’s offer price is equivalent to the ¥2 trillion ($17.8 billion) offered by the consortium, which includes state-backed fund Innovation Network Corp. of Japan, the state-owned Development Bank of Japan, U.S. fund Bain Capital and SK Hynix Inc. of South Korea.

Toshiba is aiming to finalize the deal by Wednesday, when it holds a shareholders’ meeting, as it is rushing to raise cash to eliminate its negative net worth by next March to avoid being delisted from the Tokyo Stock Exchange.

KKR was previously part of the consortium and Western Digital had at one point sought to join the group to make concessions to Toshiba but failed to reach a solution.

The U.S. company sought arbitration with an international court in May and asked a U.S. court to block the sale this month.

The Japanese conglomerate is reeling from massive losses in its U.S. nuclear business, after its former subsidiary, Westinghouse Electric Co., filed for Chapter 11 bankruptcy protection in March.

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