Toshiba weighs splitting into three listed firms amid overhaul

Toshiba Corp. is considering splitting itself into three companies as it seeks to improve corporate value, sources said Monday.

The industrial conglomerate plans to reorganize itself into infrastructure, devices and semiconductor memory firms, all of which will go public, the sources said.

If the plan materializes, Toshiba will become the first major Japanese electronics company to split itself into several firms and bring them public.

However, the firm is also considering various other options, including going private, the sources said.

The envisaged splitting of Toshiba, a household name with a long history, comes as the company aims to streamline its businesses. Such a move could significantly change the landscape of the tech sector.

The idea may be included in a new medium-term business plan Toshiba is scheduled to announce on Friday, according to the sources.

A Toshiba official said the company “is considering a split-up as one of the options for increasing corporate value,” but that “nothing has been decided.”

Toshiba’s business portfolios range from infrastructure and nuclear power to semiconductors and elevators, making it one of the Japanese firms seen as crucial for national security.

Under the split-up plan, the infrastructure firm will mainly engage in power generation, telecommunications, elevators and air conditioners. The devices firm will handle hard disk drives and power semiconductors.

The semiconductor memory firm will hold shares of Kioxia Holdings Corp., which is partly owned by Toshiba.

Toshiba has faced mounting pressure from foreign activist shareholders, who own the bulk of the company, to make its business portfolio more efficient.

In recent years, Toshiba accepted investments from foreign investors to cope with its financial hardships following the 2017 bankruptcy of its U.S. nuclear plant subsidiary Westinghouse Electric Co.

In June, an independent investigation panel found that Toshiba had colluded with the Japanese government in blocking activist foreign investors from influencing its board last year. As a result, the board’s chairman was voted out during a general shareholders meeting, in a rare victory for shareholder activism.

Since the meeting, the company has been exploring ways to maximize corporate value and shareholder returns.

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