In return, Apple would get a stake of over 20%, while Foxconn would have around 30. Toshiba would retain a partial stake, keeping it under U.S. and Japanese control. According to the report, the aim is to allay Japanese fears about the transfer of sensitive technology to investors.
Chinese Ties
Both Apple and Foxconn are yet to comment on the matter, and sources are yet unidentified. Foxconn’s offer allegedly sits at $27 billion, but there have been concerns about the firm’s ties to China, which could delay regulatory approval. As a result, Toshiba is also looking at an $18 billion offer from another Apple supplier, Broadcom. It’s also considering a $4.6 billion investment from the Japanese government and a separate offer from SK Hynix. However, all of these may violate contracts with Western Digital Corp, a Toshiba partner. The firm also has a bid for the business and says the company is violating a joint venture contract. According to WDC, it should receive exclusive negotiating rights. Thankfully, Toshiba shares have managed a slight recovery following the announcement of Apple’s interest. Stock has been declining at a steady rate, down 29% this year. Such a deal could give the electronics manufacturer the cash it needs to continue. The company began taking significant losses after a problem with its Westinghouse nuclear arm. The Toshiba-led conglomerate filed for bankruptcy on Wednesday after unforeseen issues. Increased safety demands by the U.S. have resulted in higher costs for labor and equipment. The total liability for Westinghouse sits at $9.8 billion, so the sale of the chip business will help keep the parent company afloat. Whatever the outcome, Toshiba seems to have a tough few months ahead.
