Flash chip builder Toshiba Memory Corp. is buying out its US corporate shareholders, all customers who helped the company out last year.
In June 2018 financially-troubled Toshiba sold its Toshiba Memory Corporation NAND chip business for $18bn to a consortium led by Bain and including SK Hynix, Apple, Dell Technologies, Seagate Technology and Kingston Technology.
Toshiba Memory Corporation operates a joint venture with Western Digital that makes flash chips.
As part of the Bain deal Toshiba repurchased 40 per cent of the unit, leaving 60 per cent in the Bain consortium’s hands.
Now Toshiba Memory Holdings Corp. (TMC) is to buy back the shares from Apple, Dell, Kingston, and Seagate, with Japanese banks lending it ¥1.3 trillion ($11.8bn) to refinance the company. It also intends to get a Tokyo Stock Exchange listing.
That could provide Bain with a profitable exit for its TMC holdings.
The four US companies are customers for TMC’s flash chips. They joined the consortium to help TMC stay independent from Western Digital which tried to buy the company. As Toshiba’s partner in the flash fab joint-venture, a Western Digital purchase would have reduced price-competition in for NAND chips.
The Wall Street Journal reports that the four will receive $4bn to $4.5bn for their TMC shares. That will give them a profit of a few hundred million dollars – not bad for an investment that lasted for less than a year.