The chip business is responsible for Toshiba's wide array of memory solutions, which include its latest high-efficient 3D NAND technology which has high use cases in modern smartphones, servers, and other major devices.
Toshiba quickly hit back at its joint venture partner, saying that "Western Digital persistently overstates its limited consent rights in public statements". Toshiba chose Bain over a group led by KKR & Co. and two state-backed funds, Innovation Network Corp. of Japan and Development Bank of Japan.
The consortium, led by Bain, was outlined as the preferential bidder earlier this year, but delays from lawsuits, government and corporate decisions had led to the delay of the sale.
The deal, agreed to by Toshiba's board of directors at a meeting Wednesday (Sept. 20), came just hours after the Retuers news service, citing anonymous sources, reported that Toshiba was once again leaning toward accepting a rival bid from Western Digital.
In response to the MOU, Western Digital said it was surprised Toshiba would look to do a deal with Bain "without SanDisk's consent, as the language in the relevant JV agreements is unambiguous, and multiple courts have ruled in favor of protecting SanDisk's contractual rights".More news: Cassidy promotes bill meant to replace Obamacare
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Toshiba Corp has chose to sell its chip unit to a Japan-U.S.
If the dispute with Western Digital is unresolved at closing, three joint ventures between Toshiba and Western Digital would not be transferred to Bain and the purchase price would be adjusted, said one of the people, asking not to be identified because the matter isn't public.
Following the signing of a memorandum of understanding on 13 September, Toshiba has apparently concluded a deal to sell its semiconductor business to Bain Capital for $18billion.
The consortium has put forward an acquisition offer of some ¥2.4 trillion, including funds for equipment investment. Apple, Dell and other U.S. tech firms have also reportedly joined the consortium.