Published: Wed, September 13, 2017
Science | By Hubert Green

Western Digital to win Toshiba chip unit bidding war

Western Digital to win Toshiba chip unit bidding war

However, if Western Digital remains a minority investor in the business, Apple, a top customer for Toshiba chips, is offering about 50 billion yen ($460 million) to a group including the U.S. firm to help finance a bid, one source said. -South Korean group had said that Bain Capital and other entities in the group would take over INCJ and DBJ's investment until the legal spat with Western Digital is resolved while raising the price tag for Toshiba Memory Corp to 2.4 trillion yen, becoming a strong contender. The consortium and Toshiba aim to announce a deal on Wednesday or Thursday.

Yoshimitsu Kobayashi, an external Toshiba director, told reporters earlier on Tuesday that although the deadline is important, it is also important that negotiations head in a good direction. The Japanese unit of Bain Capital and SK Hynix could not be reached for comment outside business hours.

According to the report, Toshiba has accepted an $18.3 billion bid from its former partner.

Just yesterday, it looked like Western Digital were set to miss out on the deal, after a consortium led by Bain submitted a $22 billion bid of its own. While Western Digital is very much in the driver's seat in talks, it has made several key concessions to secure a deal that Toshiba is willing to accept and that will keep the unit out of the hands of rival chip firms, sources have said.

The latest decision comes after Toshiba had been inclined to seal a deal with a group led by Western Digital, which has jointly invested in Toshiba's Yokkaichi flash memory plant in central Japan.

On Friday, the Bain group raised its offer by almost 500 billion yen to 2.4 trillion yen ($22 billion), including a 200 billion yen investment in infrastructure, sources have said. Last week it said it was considering three competing offers including one led by Taiwan's Hon Hai (2317.TW), also known as Foxconn. Apple apparently said it worries about pricing.

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