Published: Thu, September 28, 2017
Economy | By Melissa Porter

Apple holding up Toshiba memory sale

Apple holding up Toshiba memory sale

The consortium, Toshiba, and Hoya Corp. will each hold stakes of 49.9 percent, 40.2 percent, and 9.9 percent, respectively, according to SK hynix. The remaining 2.7 trillion won will be invested in a new fund that will be set up by Bain Capital.

The world's second-largest DRAM chipmaker said the upcoming stake ownership would help it strengthen its competitiveness in the NAND chip market in the long term.

SK Hynix will be joined by Apple after talks over the future supply of NAND flash memory chips were settled.

Apple had previously opposed KKR's bid because its consortium included Western Digital, which is a joint investor in TMC's flash memory facility. The inclusion of SK Hynix and Seagate, both competitors to WDC, are obviously displeasing to the company.

Even if Toshiba manages to sign the deal with the Bain group imminently, it is still cutting it fine as regulatory reviews often take six months.

Meanwhile, Chey Tae-won, chairman of the SK Group, embarked on a business trip to Japan with Park Jung-ho, president of SK Telecom on the day. Western Digital says that it has legal rights to block any deal made without its consent. It contends that any transfer of Toshiba's memory operations without its consent would violate joint venture agreements.

However, since it usually takes more than a year for the International Arbitration Court to arrive at a conclusion for arbitration, WD chose to seek an injunction which can put a quick brake on the sell-off of Toshiba Memory.

September 20 arbitration: Western Digital wants to block Toshiba from going alone on constructing a new memory chip plant called Fab 6. WD expects the results of its application for an injunction to come out within this year at the earliest. A court has already temporarily ruled in Western Digital's favor on this one.

"The Japanese company needs cash to shore up a balance sheet destroyed by a failed foray into the nuclear power equipment industry and is facing a deadline in March to complete a deal or be delisted from the Tokyo Stock Exchange". But the USA firm, whose relationship with Toshiba has rapidly deteriorated, would not agree to limits to any future stake in the chip business that Toshiba had demanded, sources have said.

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