Toshiba shareholders OK memory biz split 

March 31, 2017

Shareholders of struggling Japanese electronics and machinery maker Toshiba Corp. on Thursday approved the company's plan to split off its lucrative flash memory business as a way to remedy its balance sheet.

The approval was given at an extraordinary general shareholders meeting held at the Makuhari Messe convention center in the city of Chiba, east of Tokyo.

Toshiba is aiming to generate about 2 trillion yen by selling the chip division, which earns about half of its operating profit.

The firm's financial base has been marred by massive losses at its US nuclear business unit Westinghouse Electric Co., which filed for Chapter 11 bankruptcy protection on Wednesday.

The split-off entity will be relaunched as Toshiba Memory Corp. on Saturday. Toshiba plans to pick the buyer of a majority stake in the new company as early as May.

At the beginning of the shareholders meeting, Toshiba President Satoshi Tsunakawa said, "I apologize for the trouble and concern" caused by the massive losses from the US nuclear business.

He said that Toshiba aims to improve its financial and capital bases through the withdrawal from the overseas nuclear business and the sale of the flash memory division.

Tsunakawa then underscored the company's determination to quickly improve its earnings and overcome the present crisis by focusing mainly on its social infrastructure business.

During the meeting, many shareholders harshly blamed the management for failing to prevent huge losses at Westinghouse while voicing concerns about the company's future after relinquishing its crown jewel flash memory business. Jiji Press