Sale of Toshiba's NAND Chip Unit Faces Trouble as Western Digital Threatens Legal Action

uncertainty on company end toshiba's much-sought-after nand chip unit -- second-biggest in world -- has deepened today report reuters, states japan-based toshiba facing legal actions business partner , chip unit bidder western digital. u.s.-based data storage company claiming toshiba has violated contract transferring western digital's joint venture rights entirely newly formed chip unit, toshiba sell off.

result, western digital reportedly asking exclusive negotiating rights toshiba means win bid , retain contract supplier, , u.s. company threatening legal action in event not. western digital operates semiconductor plant in joint partnership toshiba, not seen favored bidder in eyes of toshiba executives because has placed "much lower offer other suitors."

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legal process set in motion western digital not delay toshiba's nand chip unit sale, company needs completed offset $9 billion loss related overseas nuclear division, put end auction altogether. toshiba has rejected of western digital's claims has violated joint venture contract.

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the clash between toshiba , western digital - both business partner , 1 of bidders chip unit - risks delaying or quashing auction japanese conglomerate depending on plug $9 billion hole in accounts.

in may 3 letter sent toshiba's lawyers, tvs-to-nuclear conglomerate disputed western digital' s argument , said pursue available remedies if saw continued interference in sale process. western digital's "campaign constitutes intentional interference toshiba's prospective economic advantage , current contracts. improper, , must stop," letter, seen reuters on tuesday, said.

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western digital has until may 15 sign few agreements related joint venture partnership toshiba, , if doesn't western digital employees restricted facilities, networks , databases related toshiba's nand chip unit. according masahiko ishino, analyst @ tokai tokyo research center, western digital has solid ground legal action: "from commonsense standpoint, it's hard buy toshiba's argument doesn't need approval jv partner because it's 50-50 joint venture."

outside of legal battle, toshiba executives said prioritizing potential bids amount consortium of new york-based private equity firm kkr & co lp , few japanese government-backed investors representing japan innovation network corp. japanese government said "keeping close eye on process," , prevent deal potentially transfer sensitive technological information country, namely foxconn , deep china ties.

now, kkr , japan innovation network corp preferred bidders, , expected enter joint offer in upcoming second round of bidding in mid-may. if duo win exclusive rights toshiba's nand chip unit, technology stay in japan, appeasing local government, , new owners of unit aim ipo down line.

2 new preferred bidders come after tsmc , foxconn reported main companies interested in toshiba's chip unit, tsmc dropped out , foxconn faced troubled waters japanese government. last month, apple rumored willing spend several billion dollars obtain "substantial stake" in toshiba nand chip unit, enough of share ownership allow toshiba's executives retain partial ownership in japan.

other potential buyers include south korea's sk hynix, amazon, google, broadcom, , more, looking major foothold in flash memory market allow them compete likes of samsung. winning bidder expected revealed sometime in june.

article link: sale of toshiba's nand chip unit faces trouble western digital threatens legal action

 

still amazes me, samsung, scope of companies. being able buy tv same company powers nuclear reactor on top.

 

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