Toshiba shares surge following report of $19 bln buyout bid

Reuters

11:27 JST, October 13, 2022

TOKYO (Reuters) – Shares in Toshiba Corp 6502.T surged on Thursday following a report that a domestic-led consortium is looking to buy the Japanese conglomerate for 2.8 trillion yen ($19.1 billion).

News agency Kyodo reported on Wednesday that a group of firms led by Japan Industrial Partners, a domestic private equity firm, had made the bid, which marked a premium of around 26% from Wednesday’s closing price.

The consortium will put up around 1 trillion yen in equity, with the rest of the money likely to come from bank financing, Kyodo said, adding that financing talks were ongoing. The price could also change depending on future movements of Toshiba’s stock price, Kyodo said.

“I am pretty sure that consortium could do that price. The bank funding is almost certainly there to pay more,” said analyst Travis Lundy of Quiddity Advisors on the Smartkarma platform.

Shares of Toshiba jumped 7.5% to trade at 5,519 yen as of 0126 GMT, putting them on track for their biggest one-day gain in more than a year. They rose as high as 5,616 yen.

The consortium, which includes Chubu Electric Power Co 9502.T, has received the right of first refusal in its bid for Toshiba, the Nikkei business daily previously reported.

Asked about the report, a Toshiba spokesperson said on Wednesday the company could not comment on candidates as doing so could undermine fair process.

Toshiba said last month it had received multiple in-depth written indications of interest from potential partners in a second bidding round for strategic alternatives.

$1 = 146.7700 yen